Campbell Soup Company Annual Report 2002

FY2002 Annual Report · Campbell Soup Company

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Working the plan

How the people of Campbell are transforming their company –
by delighting consumers, revitalizing great brands, enhancing quality and
productivity, and laying the groundwork for a more rewarding future.

2002 Annual Report

In 2001, Campbell launched a
clear plan for corporate renewal:

1. Revitalize U.S. Soup.
2. Strengthen the broader portfolio for

consistent sales and earnings growth.

3. Build new growth avenues.
4. Drive a quality agenda while

continuing to drive productivity.
5. Improve organization excellence

and vitality.

In 2002, we rolled up our sleeves and began to
put our plan into action. As a result, we’re making
progress in nearly every part of the company.

In this annual report, we’ll show you what we’ve been

doing – and, more importantly, where we’re going
from here. As you turn the pages, you’ll see how the
transformation of Campbell has begun – how we’re
leveraging great brands and talented people to win
in the marketplace and in the workplace.

At Campbell, we’re working the plan... and the plan

is beginning to work.

Financial Highlights
(millions of dollars, except per share amounts)

Net sales

Gross margin

Percent of sales

Earnings before interest and taxes 2

Percent of sales

Free cash ﬂow 3
Cash margin 4

Net earnings

Per share

Basic

Diluted

Dividends

Per share

Campbell Soup Company Annual Report 2002

2002

$ 6,133

$ 2,690

43.9%

$ 984

16.0%

$ 748

21.2%

$ 525

$ 1.28

$ 258

$ 0.63

2001
$ 5,7711
$ 2,6391

45.7%

$ 1,194

20.7%

$ 906

25.4%

$ 649

$ 1.57

$ 1.55

$ 371

$ 0.90

1 In 2002, ﬁnancial results were restated to conform to the requirements of new accounting standards. Certain consumer and trade promotional

expenses have been reclassiﬁed from Marketing and selling expenses and Cost of products sold to Net sales for 2001.

2 2002 and 2001 results include pre-tax costs of $20 ($14 after tax or $.03 per share) and $15 ($11 after tax or $.03 per share), respectively, related to an
Australian manufacturing reconﬁguration. Of these amounts, pre-tax costs of approximately $19 and $5 were recorded in 2002 and 2001, respectively,
in Cost of products sold.

3 Free cash ﬂow equals net cash provided by operating activities less capital expenditures.

4 Cash margin equals cash earnings divided by net sales. Cash earnings equals earnings before interest and taxes plus depreciation, amortization

and minority interest expense.

About Campbell Soup Company
Campbell Soup Company is a global manufacturer and marketer of high quality soups, sauces, beverages, biscuits, confectionery,
and prepared food products. The company owns a portfolio of more than 20 market-leading businesses, each with more than
$100 million in sales. They include Campbell’s soups worldwide, Erasco soups in Germany, Liebig soups in France, Pepperidge
Farm cookies and crackers, V8 vegetable juices, V8 Splash juice beverages, Pace Mexican sauces, Prego Italian sauces,
Franco-American canned pastas and gravies, Swanson broths, Homepride sauces in the United Kingdom, Arnott’s biscuits
in Australia, and Godiva chocolates worldwide. The company also owns dry soup and sauce businesses in Europe under
the Batchelors, Oxo, Lesieur, Royco, Liebig, Heisse Tasse, Blå Band, and McDonnells brands.

02 03

Fellow Shareowners:
I am pleased to report that we have made substantial progress in
this ﬁrst year of our three-year Transformation Plan. The plan
is designed to rebuild long-term shareowner wealth by re-energizing
our brands and our people. It is the most comprehensive renewal
effort in the 133-year history of Campbell Soup Company. As I explained
in my ﬁrst letter as CEO last year, this plan requires signiﬁcant
investment to build a sustainable growth proﬁle.

In 2002, sales grew 6 percent to $6.1 billion, while net earnings declined 18 percent to $539 million,
or $1.31 per share, excluding the costs associated with the Australian manufacturing reconﬁguration.
This reduction was driven by our decision to substantially increase our investment in marketing to
reinvigorate our brands and in infrastructure to rebuild our company. Encouragingly, we made progress
toward that goal on multiple fronts:

• We began to improve the quality of many of our market-leading products, notably in U.S. Soup,

by leveraging improved consumer understanding and technical capabilities.

• We dramatically increased marketing investments to highly competitive levels for many of our core

brands, resulting in solid volume growth.

• We ramped up our productivity proﬁle, leveraging fresh thinking, new tools and techniques, and plenty

of old-fashioned hard work.

• We added depth and breadth to our new product pipelines around the world, and we announced two

acquisitions to strengthen our international growth prospects.

• We further strengthened our global leadership team to ensure both short-term and long-term success.

In short, we did what we said we would do. However, we are far from satisﬁed. We can and will do better.

1. Revitalize U.S. Soup.
Our highest priority is to revitalize our core U.S. Soup business. We have set in motion a comprehensive
program to upgrade product quality, substantially increase marketing investment, accelerate product
innovation, and improve sales execution. This program delivered a healthy 9 percent increase in our
ready-to-serve soup portfolio, and we expect this momentum to continue. Our condensed soup
portfolio declined 5 percent. We expect improved performance on condensed in ﬁscal 2003 and 2004,
as we introduce signiﬁcant product improvements and more convenient easy-to-open packaging.

Campbell Soup Company Annual Report 2002

Letter to Shareowners
continued

“Change is well underway at Campbell. We are pleased with
the ﬁrst year of this change, but we still have much more to
do to resume our winning ways ... and we will.”
Doug Conant

Toward year end, we took a major step in delivering breakthrough soup forms by beginning the national
launch of Campbell’s Soup at Hand, the ﬁrst sippable soup in its own microwaveable container in the U.S.

2. Strengthen the Broader Portfolio.
Beyond U.S. Soup, we have a strong portfolio of brands in growing categories and focused geographies
that has responded positively to the increased resources in marketing and infrastructure.

We advanced our new North America Sauces and Beverages Division with a dedicated leadership team.
Three of the division’s core brands – V8 vegetable juice, Pace Mexican sauces and Prego sauces – have
delivered strong growth.

Our Biscuits and Confectionery businesses also responded to increased support. Pepperidge Farm and
Arnotts delivered strong sales growth and gains in market share across many key segments. Even our
Godiva business, which was adversely impacted by the events of September 11 and a slowing U.S. economy,
delivered improved sales performance as we continued to invest in new stores around the world.

We delivered solid sales growth in our Canadian, Mexican and Latin American operations.

3. Begin to Build New Growth Avenues.
Over the past year, we completed the integration of the European dry soup and sauce brands we acquired in
May 2001. Now, we are focusing on leveraging our more substantial European presence for improved growth.

To further augment our European effort, we have recently acquired Erin Foods, the #2 dry soup company in
Ireland. In Australia, we have strengthened our presence in the snack market through the acquisition of Snack
Foods Limited, the #2 salty snack company. Given our #1 position in biscuits with the Arnott’s brand, we are
now even more competitive in the broader snacking category.

To help foster greater organic growth, we created a new growth business unit with a charter to identify new
opportunities that do not naturally fall within the scope of our existing business units.

4. Drive Quality and Productivity.
We have substantially improved our ability to create superior products by increasing research and
development resources, and by introducing a comprehensive product quality tracking and improvement
process across our top-selling 150 products. On the productivity side, we generated well over $100 million
in savings in ﬁscal 2002, and we have targeted an even greater amount in ﬁscal 2003.

04 05

5. Improve Organization Excellence and Vitality.
Revitalizing our workforce is essential to the success of
our Transformation Plan. By strengthening our functional
capabilities, expanding the capacity of our business units, and
improving the morale of our associates, we have galvanized
our organization and attracted talented new leaders. To ensure
that we stay on track, we have also implemented a systematic
process to measure employee engagement and satisfaction.

Outlook
As we enter the second year of our Transformation Plan, our
business is poised for growth, but not yet at the levels to
which we aspire. We will continue to invest, for the long-term,
in brand building, innovation, quality, and infrastructure.

We expect our soup business to achieve positive growth
this year as we see more of our revitalization plan pay beneﬁts.
We also expect to see continued growth in our broader
portfolio, including our Biscuits and Confectionery businesses.
Capital spending will remain at a higher level as we continue to
invest in our soup plants with new and enhanced technologies,
and complete a new Pepperidge Farm bakery in Connecticut.

Change is well underway at Campbell. We are pleased with
the ﬁrst year of this change, but we still have much more to
do to resume our winning ways ... and we will.

Sincerely,

Chairman’s Message
In ﬁscal 2002, we completed the
ﬁrst year of our Transformation Plan.
Clearly, we followed through with
key investments necessary to lay
the foundation for future success.
Product improvements are creating consumer preference,
brands are being strengthened, and stronger partner-
ships are being formed with our customers for mutually
proﬁtable growth. Importantly, additional emphasis is
now being placed on strategic breakthroughs, of which
Campbell’s Soup at Hand is the ﬁrst example.

The two strategic acquisitions in Ireland and Australia
approved by the Board are consistent with our strategy
to build our business in geographies and categories
we know well. We continue to evaluate ways to leverage
this strong cash ﬂow to create shareholder value.

The Board visited the company’s largest manufacturing
facility in Napoleon, Ohio, to see ﬁrsthand the new
technology being used to improve soup quality and
to meet with local employees. We are making signiﬁ-
cant capital investments in our facilities and we will
continue to monitor the results of these investments.

Campbell has been a leader in corporate governance,
and the Board is reviewing the new requirements of
the Sarbanes-Oxley Act and the proposed New York
Stock Exchange corporate governance listing standards.
Campbell already meets many of these requirements.
The Board views these new laws as an opportunity to
assess and strengthen our governance position.

In November 2002, Al App and Charlie Mott will retire
from the Board, and we will miss them. Al has been a
Director since 1986. His perspectives as a scientist and
international executive have been valuable. Charlie has
been a Director since 1990, and has served as co-chair
of the Finance and Corporate Development Committee
since 1997. He has been a highly effective leader in eval-
uating investment, ﬁnance, and pension issues. The
nominees to succeed them are Randall W. Larrimore,
President and CEO of United Stationers, Inc., and
David C. Patterson, Chairman of Brandywine Trust
Company. Randy brings outstanding leadership skills
and many years’ experience in the consumer goods
industry. David brings important experience in the legal
and investment management areas. I am conﬁdent
Randy and David will be valuable additions to the Board.

Douglas R. Conant
President and Chief Executive Ofﬁcer

Sincerely,

George M. Sherman
Chairman of the Board

Campbell Soup Company Annual Report 2002

U.S. Soup.

1Revitalize

A better soup
in every bowl
Our drive to delight consumers combines culinary skills,
technological knowledge, deep understanding of consumer
needs, and our unwavering commitment to improve the
quality and value of Campbell’s soups. We’re dramatically
enhancing the ﬂavor, texture, and appearance of our
soups. We’re adding more ingredients and new varieties
to win over more consumers. At the same time, more
frequent advertising reinforces the pleasures
of a bowl of Campbell’s soup. The goal: to gain
competitive advantage with all of our soups
for a vast array of meal occasions.

A measurable
difference

Over the next three years, our chefs will
transform the very meaning of M’m! M’m!
Good! with improvements to 80 percent
of Campbell’s condensed soups. This year,
Campbell’s condensed Vegetable soup
will have more vegetables and Campbell’s
condensed Chicken with Rice soup will
have more rice. Also on the horizon for
our condensed soups are easy-open lids.
We are working to make these soups
the best they can be – and will spread the
news through targeted advertising.

06 07

Campbell Soup Company Annual Report 2002

Red, white, and gold
Capitalizing on our success as the ofﬁcial soup
supplier to the 2002 Olympic Winter Games,
we have partnered with U.S. women’s ﬁgure skating
Gold Medal-winner Sarah Hughes, who will serve
as our new ambassador for Campbell’s Labels for
Education program. In addition to helping Campbell
provide schools with valuable educational equipment,

Hughes will also be featured on the label

of Campbell’s condensed Chicken Noodle

soup, our #1 selling variety.

Stirring
new ideas

We connect with our consumers by encouraging
them to add a personal touch that makes our soups
their own. That’s why we’ll be promoting the
power of personalization for our #2 selling soup,
Campbell’s condensed Tomato soup. Whether
sour cream and scallions or cheese and salsa,
these creative additions will make each bowl of
tomato soup a new taste sensation.

Goldﬁsh Crackers
Add a little
“character” – there’s fun
in every one!

Sour Cream
and Scallions
Velvety smooth,
just a little tart – this
tempting addition
should add the
right zest.

Image TK

Seasonings
Add some robust ﬂavor with
basil, oregano or garlic –
fresh or dried.

Salsa
Make it mild or wild. This easy
addition will wake up any
weeknight dinner.

08 09

Revitalize
U.S. Soup.

For moms who care

With sales nearly doubling over the past five years, we’ve accelerated our push behind
Campbell’s Chunky soups. New advertising features National Football League stars and their
real-life moms, addressing hunger in their local communities. This year’s Chunky spokespersons
include Philadelphia Eagle Donovan McNabb and his mom, Wilma; Pittsburgh Steeler Jerome
Bettis and his mom, Gladys; New York Giant Michael Strahan and his mom, Louise; and Chicago
Bear Brian Urlacher and his mom, Lavoyda. Watch for the Chunky Tackling Hunger tour, which
will visit all National Football League markets during the 2002 season.

Take a behind-the-scene peek at our Chunky soup athletes and their moms as they ﬁlm this season’s commercials.

Simple pleasures
Campbell’s Select ready-to-serve soups delivered
their second straight year of double-digit sales growth
in 2002. During the next three years, we’ll build
on our success by offering an even more competitive
array of Select soups. Look for more compelling
advertising and a bold new label for this
brand, plus unique new ﬂavors such as Beef with
Portabello Mushrooms and Rice.

Beef with
Portabello
Mushrooms
and Rice

Herbed
Chicken with
Roasted
Potatoes

Beef with
Roasted
Barley

Rosemary
Chicken with
Roasted
Potatoes

Campbell Soup Company Annual Report 2002

From Campbell’s Kitchen to yours
For generations, the friendship between Campbell’s Kitchen and America’s
home cooks has grown and strengthened. Almost 1.5 million cans of Campbell’s soups
are used as an ingredient to prepare dinner each day. In 2002, more than 21,000 of
these home cooks told us they liked new, improved creamier Campbell’s condensed
Cream of Mushroom soup. As a result, we’ll make two other cooking favorites creamier
next year – Campbell’s Cream of Chicken and Cream of Celery.

10 11

Soup at Hand
The soup
for people
on the go

A few words with Diane Teer,
Vice President – North America Soup Innovation

Q: What is Campbell’s Soup at Hand?

DT: It’s a new, sippable soup that debuts nationally
this year. Simply pop the top, microwave and enjoy.
It ﬁts perfectly in your hand or car cupholder, so you
can have your soup almost anywhere.

Q: How good is it?

DT: Delicious, just like the Campbell’s soups you
already enjoy, except that smaller, blended ingredients
make it easy to sip. To start, we’ve introduced four
ﬂavors: Classic Tomato, Creamy Chicken, Cream of
Broccoli and Blended Vegetable Medley.

Q: Why is this a big idea?

DT: Campbell’s Soup at Hand is absolutely on-trend!
This product moves Campbell further into the fast-
growing, $5 billion on-the-go food category. Fifty-nine
percent of meals are rushed; 44 percent of women
carry their lunch to work, and 34 percent of lunches
are eaten on the run or skipped entirely. That’s
a lot of opportunity. In test marketing, over half of
consumption took place outside the home, and nearly
half of those who tried it made a repeat purchase.
This means the availability of Campbell’s Soup at Hand
is driving new behavior, opening up new occasions for
having delicious, hot soup.

Soup
innovators –
(l.to r.) Manuel Haro,
Diana Peebles, Diane Teer
and Tim Blankenbaker
launched Campbell’s
Soup at Hand
in 2002.

Popular
soups
“pop” out

1>>

Revitalize
U.S. Soup.

Soups
Soups
arranged by
arranged by
Beef/Vegetable,
Beef/Vegetable,
Chicken and
Chicken and
Cream flavors
Cream flavors

Signs and
tags organize
the shelf

A smart approach
to shelving
Campbell’s IQ Shelf program is a
smart, new approach to merchandising
Campbell’s soups on store shelves,
helping consumers notice new
varieties and ﬁnd the soups they
want – three to four times easier
than before. We intend to have
new smart shelving in approximately
13,000 supermarkets nationwide,
as we reach out to customers with
increased store coverage.

Campbell Soup Company Annual Report 2002

2 Strengthen the broader

portfolio for consistent sales
and earnings growth.

Investing in our brands,
unleashing their power
Beyond U.S. Soup, our portfolio includes powerful brands
such as Prego sauces, V8 beverages, Pace Mexican sauces,
Pepperidge Farm breads, cookies, and crackers, Franco-
American pasta and gravies, Arnott’s biscuits and snacks,
and Godiva chocolate. All offer opportunities for growth
in large, on-trend categories and segments, including
health and nutrition, simple meals, and premium indulgent
snacking. In 2002, we increased our investment and focus
behind this portfolio, bolstering advertising and promotion,
introducing new products, and enabling some of the
world’s best brands to begin to deliver stronger results.

12 13

Campbell Soup Company Annual Report 2002

2>>

Strengthen the broader portfolio
for consistent sales and earnings growth.

Our
successful
“Flirtation”
TV spot

Wow!

A smart drink
shows its muscle

After a hiatus of several years, it’s great to be back on the air with V8 vegetable
juice. Our new television advertising aimed at health-conscious consumers
helped put our V8 vegetable juice business back on track in 2002. This year,
we will support the V8 brand by expanding our successful advertising, launching
an exciting V8 promotion and introducing Lemon Twist V8. We’re also renewing
our efforts behind V8 Splash juice beverages. Following the introduction of
V8 Splash Lemonades and convenient plastic packaging for 16-ounce single-serve
V8 Splash products, we’ll launch V8 Splash Smoothies, a line of smooth and
fruity beverages with energizing nutrition. In addition, we’ve established a
multi-year partnership with USA Swimming and the U.S. National Swim Team
to reinforce the brand’s refreshing and healthy image.

♥
♥
14 15

Prego bakes
up success
New Prego pasta bake sauce was a
big success in 2002, fueling signiﬁcant
volume gains for the Prego brand.
To contemporize our spaghetti sauce
brand, we’ll introduce new packaging
and label designs and enhance support
of our base Prego sauces with more
competitive advertising.

What’s up
down under
Arnotts introduced low-fat Rix
Rice potato chips and premium
Kettle Sweet Potato chips in 2002.
Arnotts also announced its intent
to purchase Snack Foods Limited,
Australia’s #2 manufacturer of
salty snacks. Coming up from
Down Under – two new varieties
of Emporio gourmet biscuits.

“Never have an ordinary day“
Innovation, strong trademark campaigns,
and distribution initiatives have driven substantial
growth across all segments of Pepperidge Farm.
Star additions included new varieties of Farmhouse
bread, Giant Goldﬁsh Sandwich crackers, Five Cheese
Texas Toast, Raspberry Milano cookies, and single-
serve varieties of cookies and crackers. Debuting this
year: Goldﬁsh Colors, Farmhouse Buttertop varieties
and Oatmeal Brown Sugar Swirl bread.

Pace takes
historic trailride

In 2002, the Pace Mexican sauce
brand reached back in its advertising history,
introducing television spots loaded
with Southwestern imagery and focused
on the brand’s heritage and high-quality
ingredients. This strategy drove increased
sales and volume growth across all channels.
We’ll take Pace advertising national in
2003, introduce a new Mexican sauce, and
continue to support core markets
“West of the Mississippi” with focused
grassroots-marketing efforts.

Premier chocolatier
Godiva continued its quest to become
the world’s premier chocolatier, opening
33 new stores in 2002. In 2003, a new Nut
& Chocolate collection will make its debut
– along with a redesigned gold ballotin,
featuring three new ganache chocolates.

Campbell Soup Company Annual Report 2002

3 Build

new growth
avenues.

New ideas,
new opportunities
Offering fresh taste and added convenience, soups in
aseptic packaging are becoming more popular worldwide,
creating new opportunities for growth. In France, where
we have the most extensive expertise in aseptic technology,
our Liebig soups target a range of desirable segments.
In Australia, Velish vegetable soups lead the aseptic market.
And in Canada, our newest introduction of Gardennay aseptic
soups brings restaurant quality to Canadian consumers who
desire smoother blended soup.

Avenue for growth
In Europe, instant dry soups are the most popular form
of soup, growing at 5 percent per year. By acquiring
leading dry soup brands, we’ve increased our market share
in Europe by 50 percent and gained new access to millions
of consumers. This year, we completed the integration of
brands such as Batchelors and Oxo in the United Kingdom,
Royco in France and Belgium, Heisse Tasse in Germany,
Blå Band in Sweden, and McDonnells in Ireland. We also
announced our agreement to acquire Erin Foods, a leading
manufacturer of dry soups in Ireland.

16 17

Michelle Dobbyn, Marketing, Canada
“We chose the name Gardennay because it had
appetite appeal for both French- and English-
speaking Canadian consumers.”

Al Brezina, Supply Chain, Canada
“Aseptic technology produces extraordinary
taste and is a building block for future
product innovation.”

Zahir Kassam, Consumer Insights, Canada
“Consumers tell us Gardennay embodies
exceptional taste, vegetable goodness, and
high quality.”

Raewyn Hill, Research & Development, Australia
“We benchmarked successes in Australia and
France to create delicious ﬂavors like Butternut
Squash and Blended Country Vegetable.”

18 19

4 Drive a quality

agenda while continuing
to drive productivity.

A new way to cook,
a new way to work
Improving product quality while at the same time improving
productivity is essential. In 2002, we made substantial progress
on both sides of this equation, strengthening research and
development and creating a global supply chain that leverages
our scale. We are also changing our manufacturing processes
for soup and believe that these processes will make Campbell’s
soups the preferred choice of more and more consumers.
Our plans, however, go far beyond soup, as we
begin to set higher quality standards across
our entire portfolio.

Working smart
Using advanced technology,
new formulations, and innovative
ideas, we’re redeﬁning how we
work in manufacturing plants like
Napoleon, Ohio, pictured on
the opposite page. Our new
approach to soup manufacturing
is already driving superior
marketplace results for Campbell’s
Select soups and Campbell’s
Chunky soups, and we expect it
will have a major impact on our
condensed soups as well.

Enhanced
color and
flavor

The cold
blend revolution
Cold blend processing enables us
to uniquely deliver truer ﬂavors, tastier
ingredients, and brighter, clearer, more
delicious broth to our consumers. Cold
blend technology, combined with additional
processing technology upgrades, is
fundamental to our efforts to reinvigorate
U.S. Soup and offers a quantum leap
in quality that will be difﬁcult for our
competitors to match.

Firmer
pasta

Improved
taste

Campbell Soup Company Annual Report 2002

5 Improve

organization excellence
and vitality.

Investing in, and tapping
the power of, our people
Organization renewal at Campbell moved into high
gear in 2002. While we stepped up efforts to attract and
develop the best talent in the industry, we also introduced
a “matrix organization”that enables us to leverage our
skills and share best practices worldwide. At the same
time, we are upgrading our resources and improving work
environments, ensuring that our people have the tools
they need to win in the workplace and in the marketplace.

In 2002, we:

>> Continued strengthening our leaders by fashioning a company leadership

model that values integrity, motivation, and a “can do”mindset.

>> Launched The Campbell Vision, including a unifying, company-wide pledge

to work together to achieve extraordinary results.

>> Initiated a continuing series of employee satisfaction surveys, providing fresh
insight on how to make working at Campbell a more productive and rewarding
experience for our employees.

>> Introduced Campbell’s Camp de Cuisine – an immersion experience for our

business school recruits about our company, our consumers, and our rich culinary
history, including hands-on time in the kitchen preparing the same meals
consumers have cooked and cherished for years.

20 21

The Campbell Vision

Together we will
do extraordinary things
in the workplace and in
the marketplace

The Campbell Way

Together we will...

>> Delight our consumers

>> Build the world’s
greatest brands

>> Deliver the highest
imaginable quality

>> Drive the lowest
imaginable cost

>> Develop the best
imaginable team

>> Produce the most

extraordinary results

Campbell Soup Company Annual Report 2002

Financial Review

23 Management’s Discussion and

Analysis of Results of Operations and
Financial Condition

32 Consolidated Statements of Earnings
33 Consolidated Balance Sheets
34 Consolidated Statements of Cash Flows
35 Consolidated Statements of
Shareowners’ Equity (Deﬁcit)

36 Notes to Consolidated
Financial Statements
48 Report of Management
49 Report of Independent Accountants
50 Five-Year Review – Consolidated

22 23

Management’s Discussion and Analysis of
Results of Operations and Financial Condition

Results of Operations

Overview Net earnings for 2002 were $525 million
($1.28 per share). (All earnings per share amounts included
in Management’s Discussion and Analysis are presented
on a diluted basis.) In 2002, net earnings declined 19% and
earnings per share declined 17%. The 2002 results included
costs of $20 million pre-tax ($.03 per share) associated
with the Australian manufacturing reconﬁguration which
commenced in 2001. Pre-tax costs of $19 million were classi-
fied as Cost of products sold and $1 million as a Restructuring
charge. The 2001 results included a restructuring charge
and related costs of approximately $15 million pre-tax
($.03 per share) associated with the manufacturing reconﬁgu-
ration. Pre-tax charges of $10 million were classiﬁed as a
Restructuring charge and $5 million were classiﬁed as Cost of
products sold. Net earnings in 2001 also include an approx-
imate $.03 per share dilutive impact from the European soup
and sauce brands acquisition. Excluding the impact of the
costs associated with the manufacturing reconﬁguration,
net earnings in 2002 declined 18% and earnings per share
declined 17%. The earnings decline was primarily related
to planned increases in marketing and infrastructure invest-
ments across major businesses, partially offset by lower
interest expense.

Certain reclassiﬁcations were made to the ﬁnancial state-
ments to comply with new accounting standards. In the ﬁrst
quarter of 2002, the company adopted EITF Issue No. 00-14
“Accounting for Certain Sales Incentives” and Issue No. 00-25
“Vendor Income Statement Characterization of Consideration
Paid to a Reseller of the Vendor’s Products,” as codiﬁed by
Issue No. 01-9 “Accounting for Consideration Given by a
Vendor to a Customer or Reseller of the Vendor’s Products.”
Under these Issues, the EITF concluded that certain consumer
and trade promotion expenses, such as coupon redemption
costs, cooperative advertising programs, new product intro-
duction fees, feature price discounts and in-store display
incentives, should be classiﬁed as a reduction of sales rather
than as marketing expenses. The adoption of these new
accounting standards in 2002 resulted in the following reclas-
siﬁcations to the annual results for 2001 and 2000: Net sales
were reduced by $893 million and $840 million, respectively;
Cost of products sold was reduced by $14 million and
$19 million, respectively; and Marketing and selling expenses
were reduced by $879 million and $821 million, respectively.
These reclassiﬁcations had no impact on net earnings.

Sales Sales increased 6% in 2002 to $6.1 billion from
$5.8 billion. The increase in sales was due to a 4% increase
from the European acquisition which was completed in
May 2001, a 2% increase due to volume and mix, a

1% increase due to higher selling prices, offset by a 1%
decline due to increased trade promotion and consumer
coupon redemption expenses. Worldwide wet soup volume
increased 1% from 2001.

Sales in 2001 increased 3% to $5.8 billion from $5.6 billion.
The increase was attributed to a 4% increase due to volume
and mix, a 1% increase from higher selling prices, a 1%
increase from the acquisition, offset by a 1% decrease due
to increased trade promotion and consumer coupon
redemption expenses and a 2% decrease due to currency.
Worldwide wet soup volume increased 5% from 2000.

An analysis of net sales by segment follows:

(millions)

2002

2001

2000

% Change

2002/
2001

2001/
2000

North America Soup

and Away From Home

$ 2,524 $ 2,532 $ 2,434

—

North America Sauces

and Beverages

Biscuits and

Confectionery

International Soup

and Sauces

Other

1,182

1,161

1,156

1,507

1,446

1,391

920

—

632

—

622

$ 6,133 $ 5,771 $ 5,626

—

Sales in 2002 from North America Soup and Away From Home
were ﬂat with 2001. Volume and mix increased 1% from the
prior year, offset by an increase in trade promotion and
consumer coupon redemption expenses. U.S. wet soup
volume increased 1%. Ready-to-serve volume increased 9%
behind the double-digit volume gains in Campbell’s Chunky
and Campbell’s Select soups. This sales growth was driven
by new varieties, quality improvements, and increased
advertising. Swanson broth volume increased 4%. Condensed
soup volume declined 5%. Canada reported sales growth in
all businesses, particularly soup, in response to increased
marketing. Away From Home sales slightly increased over the
prior year led by solid soup sales performance, which offset
a decline in lower margin bakery and frozen entrée sales.

The 4% increase in sales from North America Soup and Away
From Home in 2001 versus 2000 was due to the following:
6% increase from volume and mix, offset by a 1% increase in
trade promotion and consumer coupon redemption expenses,
and a 1% decline due to currency. Soup volume in the U.S.
increased 6% over the prior year based on the performance
of condensed Chicken Noodle, Tomato and Cream of
Mushroom, ready-to-serve varieties such as Campbell’s Chunky
and Campbell’s Select and the introduction of Campbell’s
ready-to-serve classics. Canada and Away From Home also
contributed to volume growth.

Campbell Soup Company Annual Report 2002

Management’s Discussion and Analysis of
Results of Operations and Financial Condition

The 2% increase in sales from North America Sauces and
Beverages in 2002 versus 2001 was due to a 3% increase
in volume and mix, offset by a 1% reduction due to higher
trade promotion and consumer coupon redemption expenses.
The volume growth resulted from the performance of Prego
pasta bake sauces, which were introduced in the fourth quarter
of 2001, Pace Mexican sauces, V8 vegetable juices and the
Mexican business. These volume gains were partially offset
by continued declines in Franco-American canned pasta
and V8 Splash.

Sales from North America Sauces and Beverages were
relatively ﬂat in 2001 compared to 2000. Franco-American
products and V8 Splash experienced sales declines in
highly competitive categories. Sales of Prego sauce and
Pace salsa increased modestly.

Sales from Biscuits and Confectionery increased 4% in 2002
due to a 4% increase in volume and mix, a 1% increase from
higher selling prices, offset by a 1% decline from currency,
primarily the Australian dollar. Pepperidge Farm contributed
to the sales growth with new products, including the intro-
duction of Dessert Bliss cookies and Goldﬁsh Sandwich
crackers, and increased distribution. Arnotts in Australia
reported volume gains due to increases in value-added
products in the snack foods category, such as Rix Rice chips
and Kettle chips. Tim Tams biscuit sales also increased
signiﬁcantly. Godiva sales rose slightly, as new store openings
worldwide offset lower same store sales in North America
in the aftermath of September 11th.

Sales from Biscuits and Confectionery increased 4% in 2001
versus 2000 due to a 9% increase from volume and mix, a
1% increase from higher selling prices, offset by a 5% decline
from currency, primarily the Australian dollar, and a 1%
decrease due to increased trade promotion and consumer
coupon redemption expenses. The entire portfolio contributed
to the volume gains. Pepperidge Farm cookies, crackers,
fresh bread and frozen products all demonstrated improve-
ments in sales volume. Arnott’s Tim Tams, Shapes and Kettle
chips contributed to the growth in sales. Godiva reported
a double-digit increase in sales due to new store openings
and increased comparable store sales.

International Soup and Sauces reported a 46% increase
in sales in 2002 due primarily to a 44% increase from the
European acquisition, which was completed in the fourth
quarter of 2001, and a 2% increase from currency. The
base business in Europe declined slightly as weakness in
United Kingdom soup and sauces was partially offset by

gains in soup sales in Belgium and France. Asia Paciﬁc sales
grew robustly due to continued growth in Australian soup
and broth.

International Soup and Sauces reported a 2% increase in
sales in 2001 versus 2000 due primarily to the European
acquisition, which was completed in the fourth quarter 2001.

The decline in sales from Other in 2001 versus 2000 was due
to the divestiture of MacFarms in April 2000.

Gross Margin Gross margin, deﬁned as Net sales less Cost
of products sold, increased by $51 million in 2002 due to
the increase in sales. As a percent of sales, gross margin was
43.9% in 2002, 45.7% in 2001, and 45.1% in 2000. The per-
centage decline in 2002 was due mainly to the continuing
mix shift in U.S. soup towards ready-to-serve products, the
cost of quality improvements across a number of products,
and costs associated with the Australian manufacturing recon-
ﬁguration. The improvement in gross margin percentage in
2001 from 2000 was due to cost productivity programs and
favorable sales mix.

Marketing and Selling Expenses Marketing and selling
expenses as a percent of sales were 17.4% in 2002, 15.4%
in 2001, and 14.2% in 2000. In 2002, Marketing and selling
expenses increased approximately 21% from 2001, 16%
excluding the impact of the European acquisition. The
increase in 2002 was due primarily to the planned increases
in advertising investments across the portfolio, particularly in
U.S. soup and sauces, and selling infrastructure investments.
The increase in 2001 was due to an increase in advertising
behind core U.S. brands, principally U. S. soup, and
incremental selling costs associated with new store openings
in the Godiva Chocolatier business.

General and Administrative Expenses Administrative
expenses as a percent of sales increased to 6.9% in 2002
from 6.4% in 2001 due to costs associated with infrastructure
investments and higher compensation costs. In 2001,
Administrative expenses increased to 6.4% of Net sales from
5.7% in 2000 due to higher compensation costs and costs
associated with infrastructure enhancements.

Research and development expenses increased $14 million
or 22% in 2002 from 2001 due to costs associated with quality
improvement initiatives and new product development.

Other expenses increased 21% in 2002 due primarily to
increased amortization expense associated with the European
acquisition. Other expenses increased in 2001 as compared
to 2000 primarily due to higher stock-based incentive
compensation costs and slightly higher amortization expense.

24 25

Operating Earnings Segment operating earnings, both
as reported and excluding the costs associated with the
Australian manufacturing strategy, declined 14% in 2002
from 2001.

Segment operating earnings in 2001 were relatively ﬂat as
compared with 2000, excluding the costs associated with the
Australian manufacturing strategy and before the impact of
currency. Operating earnings as reported declined 2% in
2001 compared to 2000.

An analysis of operating earnings by segment follows:

(millions)

North America Soup

2002)1

2001)1

2000

% Change

2002/
2001

2001/
2000

and Away From Home $

624 $

774 $

768

North America Sauces

and Beverages

Biscuits and

Confectionery

International Soup

and Sauces

Corporate

236

175

295

309

197

206

1,127

1,317

1,347

(143)

(123)

(82)

984 $ 1,194 $ 1,265

(19)

(20)

(11)

(14)

(5)

(4)

(20)

(2)

1 Contributions to earnings by the Biscuits and Confectionery segment include the effect of
pre-tax costs of $20 million in 2002 and $15 million in 2001 associated with the Australian
manufacturing reconﬁguration strategy.

Earnings from North America Soup and Away From Home
decreased 19% in 2002 from 2001 due to planned increases
in trade and consumer promotion expenses, advertising
expenses, infrastructure investments and costs of quality
improvements. The promotion and advertising investments
were focused on ready-to-serve products, including
Campbell’s Chunky and Campbell’s Select, and the new
Campbell’s Supper Bakes.

Earnings from North America Soup and Away From Home
increased 1% in 2001 from 2000 due to sales volume growth
partially offset by increased marketing investments.

Earnings from North America Sauces and Beverages declined
20% in 2002 from 2001 primarily due to a signiﬁcant increase
in marketing investments, principally on Prego pasta bake
sauces, Pace and V8 vegetable juices.

Earnings from North America Sauces and Beverages
declined 5% in 2001 from 2000 primarily due to increased
marketing investments.

In 2002, earnings from Biscuits and Confectionery decreased
11% as reported, 8% excluding the impact of the Australian
manufacturing reconﬁguration costs. The decline was due to

increased marketing investments across the portfolio and a
decline in earnings from Godiva, partially offset by increased
sales in Pepperidge Farm and Arnotts.

In 2001, earnings from Biscuits and Confectionery increased
8% before the impact of currency and excluding the impact
of the Australian manufacturing reconﬁguration costs.
Reported earnings increased 3% before the impact of
Australian manufacturing reconﬁguration costs. The increase
was due to higher sales volume across the portfolio.

The 80% increase in 2002 earnings from International Soup
and Sauces was due to the European acquisition. Excluding
the acquisition, earnings declined signiﬁcantly due to lower
sales in the United Kingdom soup and sauces business and
planned increases in marketing across the portfolio.

The 20% decline in 2001 earnings from International Soup
and Sauces was primarily due to costs associated with the
integration of the European acquisition.

Corporate expenses increased in 2002 due principally
to planned infrastructure investments and higher
compensation costs.

Corporate expenses increased in 2001 primarily due to
an increase in incentive compensation costs and costs
associated with infrastructure enhancements.

Nonoperating Items Interest expense decreased 13% in
2002 from 2001. Higher interest expense due to increased
average debt levels following the fourth quarter 2001
European acquisition was more than offset by a steep
decline in short-term rates.

Interest expense increased 11% in 2001 from 2000 due
to higher debt balances resulting from the ﬁnancing of the
acquisition of European soup and sauce brands and capital
share repurchases, partially offset by lower average
interest rates.

The effective tax rate was 34.2% in both 2002 and 2001.
The 2000 effective tax rate was 33.7%. The 2000 rate was
favorably impacted by a lower effective rate on foreign
earnings, primarily driven by a reduction in the Australian
statutory rate.

Restructuring Program A restructuring charge of $10 million
($7 million after tax) was recorded in the fourth quarter
2001 for severance costs associated with the reconﬁguration
of the manufacturing network of Arnotts in Australia. In the
second quarter of 2002, the company recorded an additional
$1 million restructuring charge related to planned severance
actions. Related costs of approximately $19 million ($13 million

Campbell Soup Company Annual Report 2002

Management’s Discussion and Analysis of
Results of Operations and Financial Condition

after tax) and $5 million ($4 million after tax) were recorded
in 2002 and 2001, respectively, as Cost of products sold,
primarily representing accelerated depreciation on assets
to be taken out of service. This program was designed to
drive greater manufacturing efﬁciency resulting from the
closure of the Melbourne plant. Approximately 550 jobs
were eliminated due to the plant closure. Remaining
spending under this program primarily relates to severance
payments. As a result of this reconﬁguration, the company
expects annual pre-tax cost savings of approximately
$10 million, a portion of which will be realized in 2003.

See Note 4 to the Consolidated Financial Statements for
further discussion of this program.

Liquidity and Capital Resources

Net cash ﬂows from operating activities provided $1 billion
in 2002, compared to $1.1 billion in 2001. The decrease was
primarily due to lower net earnings resulting from planned
increases in marketing and infrastructure investments. Net
cash ﬂows from operations in 2001 decreased to $1.1 billion
from $1.2 billion in 2000 due primarily to lower net earnings.
Over the last three years, operating cash ﬂows totaled over
$3 billion. This cash generating capability provides the
company with substantial ﬁnancial ﬂexibility in meeting its
operating and investing needs.

Capital expenditures were $269 million in 2002, $200 million
in 2001 and 2000. Capital expenditures are projected to
be approximately $285 million in 2003. The increase in
2002 was due to planned process improvements, product
quality enhancements, the Australian plant reconﬁguration,
and the construction of the new Pepperidge Farm bakery
in Connecticut.

Businesses acquired in 2001 represented the purchase of
the European soup and sauce brands in May 2001. The
acquisition spending in 2002 represented a purchase price
adjustment related to the European acquisition.

In 2000, sale of businesses represented the divestiture
of MacFarms.

Long-term borrowings in 2002 were the result of a series
of debt issuances throughout the year. In September 2001,
the company issued $300 million seven-year 5.875% ﬁxed-
rate notes. The proceeds were used to repay short-term
borrowings. While planning for the issuance of these notes,
the company entered into interest rate swaps with a notional
value of approximately $138 million that effectively ﬁxed
a portion of the interest rate on the debt prior to issuance.
These contracts were settled at a loss of approximately

$4 million upon issuance of the notes. This loss is being
amortized over the life of the notes. In conjunction with
the issuance of these notes, the company also entered into a
$75 million seven-year interest rate swap that converts ﬁxed-
rate debt to variable.

In October 2001, the company issued $300 million two-year
variable-rate notes. The proceeds were also used to repay
short-term borrowings. In connection with this issuance, the
company entered into a $300 million two-year interest rate
swap that converts the variable-rate debt to ﬁxed.

On November 23, 2001, the company redeemed $100 million
5.625% ﬁxed-rate notes due in September 2003. The notes
were callable at par. This redemption was ﬁnanced with lower
rate commercial paper.

On December 11, 2001, the company issued an additional
$200 million of its existing 6.75% ﬁxed-rate notes due
February 2011, originally issued in February 2001. These
additional notes were priced at a premium to reﬂect
market conditions. The proceeds were used to repay short-
term borrowings.

In January 2002, the company repaid $300 million of
variable-rate notes due December 2003. The notes were
repaid with lower cost short-term borrowings.

On March 19, 2002, the company issued $300 million ﬁve-year
5.50% ﬁxed-rate notes. The proceeds were used to repay
$228 million variable-rate notes due in December 2003 and
short-term borrowings. In connection with this issuance,
the company entered into a ﬁve-year interest rate swap that
converts $100 million of the ﬁxed-rate debt to variable.

In June 2002, the company ﬁled a $1 billion shelf registration
statement with the Securities and Exchange Commission
to use for future offerings of debt securities. Under the
registration statement, the company may issue debt securi-
ties from time to time, depending on market conditions.
The company intends to use the proceeds to repay short-
term debt, to reduce or retire other indebtedness or for
other general corporate purposes. In 2001, the company
filed a shelf registration statement with the Securities and
Exchange Commission for $1 billion of debt, bringing total
capacity available under registration statements to $1.1 bil-
lion. This shelf registration was depleted in 2002.

Long-term borrowings completed in 2001 included both
a three-year ﬂoating rate loan, which funded the purchase
of 11 million shares under forward stock purchase contracts
for approximately $521 million in December 2000, and the
issuance of $500 million 6.75% ﬁxed-rate notes due
February 2011. The company also entered into ten-year

26 27

interest rate swap contracts with a notional value of
$250 million in connection with the issuance of the 6.75%
ﬁxed-rate notes. The proceeds of the 6.75% notes were used
primarily to repay short-term borrowings. There were no new
long-term borrowings in 2000.

Dividend payments decreased to $286 million in 2002,
compared to $374 million in 2001, due to the reduction of
the dividend per share. Dividends declared in 2002 totaled
$0.63 per share and in 2001 and 2000 totaled $0.90 per
share. The 2002 fourth quarter rate was $0.1575 per share.
The expected annual dividend rate for 2003 is $0.63.

Capital stock repurchases totaled two hundred thousand
shares at a cost of $5 million during 2002, compared to
14.3 million shares at a cost of $618 million during 2001 and
repurchases of 10.7 million shares at a cost of $394 million
in 2000. In 2001, the strategic share repurchase plan was
suspended. The company expects to continue to repurchase
shares to offset the impact of dilution from shares issued
under incentive stock compensation plans.

Total shareowners’ equity (deﬁcit) on a book basis increased
in 2002 to $(114) million from $(247) million in 2001. In 2002,
shareowners’ equity (deﬁcit) includes a minimum liability
of $208 million, net of tax, related to the company’s principal
U.S. pension plan. Following the stock market declines
in June and July 2002, the fair value of the assets included
in the pension fund fell below the accumulated beneﬁt
obligation. As required under accounting principles generally
accepted in the United States, the company recognized
the additional minimum liability and reclassiﬁed an existing
pension asset to equity. Although this non-cash adjustment
did not impact the 2002 operating results, pension expense
is expected to increase in 2003 primarily due to the lower
fair value of pension assets and a reduction in the estimated
return on plan assets. See also Note 8 to the Consolidated
Financial Statements.

The company believes that foreseeable liquidity and capital
resource requirements are expected to be met through
anticipated cash ﬂows from operations, management of
working capital, long-term borrowings under its shelf
registration, and short-term borrowings, including commercial
paper. The company believes that its sources of ﬁnancing
are adequate to meet its liquidity and capital resource
requirements. The cost and terms of any future ﬁnancing
arrangements depend on the market conditions and the
company’s ﬁnancial position at that time.

Operating Leases

Total Long-term

Cash Obligations

The following table represents signiﬁcant long-term
cash obligations:

Contractual Payments Due by Fiscal Year

(US$ equivalents in millions)

Total

2003

2004-
2006

2007-
2008 Thereafter

Debt Obligations*

$ 3,645 $ 1,196 $

602 $

605 $ 1,242

Purchase Commitments**

2,781

540

1,333

109

788

120

251

$ 6,677 $ 1,790 $ 2,044 $ 1,446 $ 1,397

* Includes capital lease obligations totaling $9 million
** Represents certain long-term supply and service agreements

At July 28, 2002, the company had $1,196 million of notes
payable due within one year and $45 million of standby letters
of credit issued on behalf of the company. The company
maintains $1.8 billion of committed revolving credit facilities,
which remain unused at July 28, 2002, except for the
$45 million of standby letters of credit. The company is
in compliance with the covenants contained in its revolving
credit facilities and debt securities.

The company enters into other commitments, such as oper-
ating lease commitments, surety bonds, and long-term
purchase arrangements, in the ordinary course of business.
Operating leases are primarily entered into for warehouse
and ofﬁce facilities, retail store space, and certain equip-
ment. Purchase commitments relate to the procurement of
ingredients, supplies, machinery and equipment and serv-
ices. These commitments are not expected to have a
material impact on liquidity.

The company guarantees approximately $74 million of
bank loans to Pepperidge Farm independent sales
distributors, which are secured by their distribution routes
that are purchased from the company.

In September 2002, the company entered into a $900 million
committed 364-day revolving credit facility, which replaced
an existing facility that matured in September 2002. The
company also has a $900 million revolving credit facility that
matures in September 2006. These agreements support the
company’s commercial paper program.

The company has ﬁnancial resources available, including
lines of credit totaling approximately $2 billion, and has
ready access to ﬁnancial markets around the world. The
pre-tax interest coverage ratio was 5.2 for 2002 compared
to 5.4 for 2001 and 6.2 for 2000.

Inﬂation

Inﬂation during recent years has not had a signiﬁcant effect
on the company. The company mitigates the effects of
inﬂation by aggressively pursuing cost productivity initiatives,
including global procurement strategies and making capital
investments that improve the efﬁciency of operations.

Campbell Soup Company Annual Report 2002

Management’s Discussion and Analysis of
Results of Operations and Financial Condition

Market Risk Sensitivity

The principal market risks to which the company is exposed
are changes in interest rates and foreign currency exchange
rates. In addition, the company is exposed to equity price
changes related to certain employee compensation obliga-
tions. The company manages its exposure to changes in
interest rates by optimizing the use of variable-rate and
fixed-rate debt and by utilizing interest rate swaps in order
to maintain its variable-to-total debt ratio within targeted
guidelines. International operations, which accounted for
approximately 29% of 2002 net sales, are concentrated
principally in Australia, Canada, France, Germany and the
United Kingdom. The company manages its foreign currency
exposures by borrowing in various foreign currencies and
utilizing cross-currency swaps, forward contracts, and options.
Swaps and forward contracts are entered into for periods
consistent with related underlying exposures and do
not constitute positions independent of those exposures.
The company does not enter into contracts for speculative
purposes and does not use leveraged instruments.

The company principally uses a combination of purchase
orders and various short- and long-term supply arrangements

Expected Fiscal Year of Maturity

in connection with the purchase of raw materials, including
certain commodities and agricultural products. On occasion,
the company may also enter into commodity futures contracts,
as considered appropriate, to reduce the volatility of price
ﬂuctuations for commodities such as corn, soybean meal
and cocoa. At July 28, 2002 and July 29, 2001, the notional
values and unrealized gains or losses on commodity futures
contracts held by the company were not material.

The information below summarizes the company’s market
risks associated with debt obligations and other signiﬁcant
ﬁnancial instruments as of July 28, 2002. Fair values included
herein have been determined based on quoted market
prices. The information presented below should be read in
conjunction with Notes 16 and 18 to the Consolidated
Financial Statements.

The table below presents principal cash ﬂows and related
interest rates by ﬁscal year of maturity for debt obligations.
Variable interest rates disclosed represent the weighted-
average rates of the portfolio at the period end. Notional
amounts and related interest rates of interest rate swaps
are presented by ﬁscal year of maturity. For the swaps,
variable rates are the average forward rates for the term
of each contract.

(US$ equivalents in millions)

2003

2004

2005

2006

2007

Thereafter

Total

Fair Value

Debt

Fixed rate

Weighted average
interest rate

Variable rate

Weighted average
interest rate

Interest Rate Swaps

Fixed to variable

Average pay rate

Average receive rate

Variable to ﬁxed

Average pay rate

Average receive rate

$ 301

$ 300

$ 1

$ 605

$ 1,242

$ 2,450

$ 2,652

6.16%

$ 895

4.76%

$ 300

2.52%

2.29%

$ 300)1

3.74%

2.63%

9.00%

6.20%

6.90%

6.37%

$ 1,195

2.46%

$ 100)2

4.12%

5.50%

325)3

425

5.39%

6.55%

5.09%

6.30%

300

(4)

3.74%

2.63%

1 Hedges variable-rate notes due in 2004.
2 Hedges 5.50% notes due in 2007.
3 Hedges $75 million of 5.875% notes and $250 million of 6.75% notes, respectively, due in 2009 and 2011.

As of July 29, 2001, ﬁxed-rate debt of approximately $1.7 billion with an average interest rate of 6.51% and variable-rate debt of approximately $2.3 billion with an average interest rate of
4.43% were outstanding. At July 29, 2001, the company had swapped $250 million of ﬁxed-rate debt to variable. The average rate received on these swaps was 6.75% and the average rate
paid was 6.47%.

28 29

The company is exposed to foreign exchange risk related to
its international operations, including non-functional currency
intercompany debt and net investments in subsidiaries.

The table below summarizes the cross-currency swaps
outstanding as of July 28, 2002, which hedge such exposures.
The notional amount of each currency and the related
weighted-average forward interest rate are presented in
the Cross-Currency Swaps table.

Cross-Currency Swaps

(US$ equivalents in millions)

Expiration

Pay ﬁxed SEK

Receive ﬁxed USD

Pay ﬁxed SEK

Receive ﬁxed USD

Pay ﬁxed EUR

Receive ﬁxed USD

Pay ﬁxed GBP

Receive ﬁxed USD

2003

2005

2007

2011

Interest
Rate

5.72%

4.03%

5.78%

5.25%

5.46%

5.75%

5.97%

6.08%

Notional
Value

$ 29

Fair
Value

$ (2)

$ 47

$ (2)

$ 200

$ (19)

$ 200

$ (14)

The cross-currency contract outstanding at July 29, 2001 represented a pay variable FrF/
receive variable US$ contract with a notional value of $110 million. This contract was canceled
in 2002. The aggregate fair value of the contract was $25 million as of July 29, 2001.

The company is also exposed to foreign exchange risk as a
result of transactions in currencies other than the functional
currency of certain subsidiaries, including subsidiary debt.
The company utilizes foreign currency forward purchase
and sale contracts to hedge these exposures. The table
below summarizes the foreign currency forward contracts
outstanding and the related weighted-average contract
exchange rates as of July 28, 2002.

Forward Exchange Contracts

(US$ equivalents in millions)

Receive USD / Pay GBP

Receive USD / Pay EUR

Receive CAD / Pay USD

Receive GBP / Pay USD

Receive USD / Pay SEK

Receive AUD / Pay NZD

Receive USD / Pay CAD

Receive JPY / Pay USD

Receive EUR / Pay GBP

Receive EUR / Pay USD

Receive USD / Pay JPY

Receive EUR / Pay SEK

Average
Contractual
Exchange
Rate

0.67

1.03

0.63

1.57

9.24

1.20

1.56

0.01

0.62

0.90

124.67

9.44

Contract
Amount

$ 229

$ 207

$ 74

$ 28

$ 20

$ 18

The company had an additional $5 million in a number of smaller contracts to purchase or
sell various other currencies, such as the Australian dollar, British pound, Canadian dollar,
euro and New Zealand dollar, as of July 28, 2002. The aggregate fair value of all contracts
was $(7) million as of July 28, 2002. Total forward exchange contracts outstanding as of
July 29, 2001 were $880 million with a fair value of $(7) million.

The company had swap contracts outstanding as of July 28,
2002, which hedge a portion of exposures relating to
certain employee compensation liabilities linked to the total
return of the Standard & Poor’s 500 Index or to the total
return of the company’s capital stock. Under these contracts,
the company pays variable interest rates and receives from
the counterparty either the Standard & Poor’s 500 Index total
return or the total return on company capital stock. The
notional value of the contracts that are linked to the return
on the Standard & Poor’s 500 Index was $21 million at
July 28, 2002 and $28 million at July 29, 2001. The average
forward interest rate applicable to the contract, which expires
in 2003, was 2.22% at July 28, 2002. The notional value of
the contract that is linked to the total return on company
capital stock was $32 million at both July 28, 2002 and
July 29, 2001. The average forward interest rate applicable to
this contract, which expires in 2003, was 2.07% at July 28,
2002. The net cost to settle these contracts was $22 million
at July 28, 2002 and $17 million at July 29, 2001. Gains and
losses on the contracts, which offset gains and losses on the
underlying employee compensation obligations, are recorded
in Other expenses.

The company’s utilization of ﬁnancial instruments in managing
market risk exposures described above is consistent with the
prior year. Changes in the portfolio of ﬁnancial instruments are
a function of the results of operations, market effects on debt
and foreign currency, and the company’s acquisition and
divestiture activities.

Signiﬁcant Accounting Estimates

The consolidated ﬁnancial statements of the company are
prepared in conformity with accounting principles generally
accepted in the United States. The preparation of these
ﬁnancial statements requires the use of estimates, judgments
and assumptions that affect the reported amounts of assets
and liabilities at the date of the ﬁnancial statements and
reported amounts of revenues and expenses during the
periods presented. Actual results could differ from those
estimates and assumptions. See Note 1 to Consolidated
Financial Statements for a discussion of signiﬁcant accounting
policies. The following areas all require the use of subjective
or complex judgments, estimates and assumptions:

Trade and consumer promotion expenses – The company
offers various sales incentive programs to customers and
consumers, such as cooperative advertising programs, feature
price discounts, in-store display incentives and coupons.
The recognition of expense for these programs involves use

Campbell Soup Company Annual Report 2002

Management’s Discussion and Analysis of
Results of Operations and Financial Condition

of judgment related to performance and redemption esti-
mates. Estimates are made based on historical experience
and other factors. Actual expenses may differ if the level of
redemption rates and performance vary from estimates.

Valuation of long-lived assets – Long-lived assets, including
fixed assets and intangibles, are reviewed for impairment
as events or changes in circumstances occur indicating that
the carrying amount of the asset may not be recoverable.
An estimate of undiscounted cash ﬂows produced by the
asset, or the appropriate group of assets, is compared to
the carrying value to determine whether impairment exists.
The estimates of future cash ﬂows involve considerable
management judgment and are based upon assumptions
about expected future operating performance. Assumptions
used in these forecasts are consistent with internal planning.
The actual cash ﬂows could differ from management’s
estimates due to changes in business conditions, operating
performance, and economic conditions.

Pension and postretirement medical beneﬁts – The company
provides certain pension and postretirement beneﬁts to
employees and retirees. Determining the cost associated
with such beneﬁts is dependent on various actuarial assump-
tions, including discount rates, expected return on plan assets,
compensation increases, turnover rates and health care trend
rates. Independent actuaries, in accordance with accounting
principles generally accepted in the United States, perform
the required calculations to determine expense. Actual
results that differ from the actuarial assumptions are gener-
ally accumulated and amortized over future periods.

Income taxes – The effective tax rate and the tax bases of
assets and liabilities reﬂect management’s estimate of the
ultimate outcome of various tax audits and issues. In addition,
valuation allowances are established for deferred tax assets
where the amount of expected future taxable income from
operations does not support the realization of the asset.

Recently Issued Accounting Pronouncements

In July 2001, the Financial Accounting Standards Board
(FASB) issued Statement of Financial Accounting Standards
(SFAS) No. 141 “Business Combinations” and SFAS No. 142
“Goodwill and Other Intangible Assets.” In addition to
requiring that all business combinations be accounted for
under the purchase method, SFAS No. 141 requires intangible
assets that meet certain criteria to be recognized as assets
apart from goodwill. The provisions of SFAS No. 142 indicate
that goodwill and indeﬁnite life intangible assets should no
longer be amortized, but rather be tested for impairment

annually. Intangible assets with a ﬁnite life shall continue to
be amortized over the estimated useful life. SFAS No. 141
was effective for business combinations initiated after
June 30, 2001. The company will adopt SFAS No. 142 in
2003. The elimination of amortization is to be applied on
a prospective basis and prior periods are not to be restated.
However, the impact of amortization of goodwill and indeﬁnite
life intangible assets is to be disclosed for prior periods.

The company is currently evaluating the impact of SFAS
No. 142. With the adoption of SFAS No. 142, the company
will use the new criteria to assess whether goodwill and cer-
tain other intangible assets are impaired. Any impairment
charge resulting from the initial impairment assessment will
be recorded as a cumulative effect of an accounting change.
The company estimates that the cumulative effect of adopting
this standard will result in a non-cash charge of approxi-
mately $45 million on a pre-tax basis in 2003. In addition, the
adoption of this standard is expected to beneﬁt net earnings
by approximately $55 million in reduced amortization of
goodwill and indeﬁnite-lived intangible assets.

In June 2001, the FASB issued SFAS No. 143 “Accounting
for Asset Retirement Obligations.” This Statement addresses
ﬁnancial accounting and reporting for obligations associated
with the retirement of tangible long-lived assets and the
associated asset retirement costs. This Statement is effective
for ﬁscal years beginning after June 15, 2002. The company
is currently evaluating the impact of this Statement, but does
not expect the adoption to have a material impact on the
ﬁnancial statements.

In August 2001, the FASB issued SFAS No. 144 “Accounting
for the Impairment or Disposal of Long-Lived Assets.” This
Statement addresses ﬁnancial accounting and reporting
for the impairment or disposal of long-lived assets. This
Statement supersedes SFAS No. 121, “Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets
to Be Disposed Of,” and the accounting and reporting
provisions of APB Opinion No. 30, “Reporting the Results of
Operations – Reporting the Effects of Disposal of a Segment
of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions,” for the disposal of a
segment of a business. The provisions of this Statement are
effective for ﬁscal years beginning after December 15, 2001.
The company is currently evaluating the impact of this
Statement, but does not expect the adoption to have a
material impact on the ﬁnancial statements.

In July 2002, the FASB issued SFAS No. 146 “Accounting
for Exit or Disposal Activities.” The provisions of this

30 31

Statement are effective for disposal activities initiated after
December 31, 2002, with early application encouraged. The
company is currently evaluating the impact of this Statement.

Recent Developments

On June 4, 2002, the company announced that its Australian
subsidiary, Arnott’s Biscuits Holdings Pty Ltd (“Arnott’s
Holdings”), had agreed to acquire all of the shares of Snack
Foods Limited, a leader in the Australian salty snack category
(“Snack Foods”), for approximately $145 million. In August
2002, Arnott’s Holdings completed the acquisition of approx-
imately 98% of the outstanding shares of Snack Foods. Arnott’s
Holdings completed the acquisition of the remaining approx-
imate 2% of Snack Foods shares on September 20, 2002.

On September 20, 2002, the company also completed the
purchase of Erin Foods, the number two dry soup manufacturer
in Ireland.

Earnings Outlook

On September 5, 2002, the company issued a press release
announcing results for 2002 and commented on the outlook
for earnings per share for the ﬁrst quarter and full year
for 2003.

Cautionary Factors That May Affect
Future Results

This 2002 Annual Report contains “forward-looking” state-
ments that reﬂect the company’s current expectations
regarding future results of operations, economic performance,
financial condition and achievements of the company. The
company tries, wherever possible, to identify these forward-
looking statements by using words such as “anticipate,”
“believe,” “estimate,” “expect,” “will” and similar expressions
in conjunction with, among other things, discussions of the
company’s “Transformation Plan.” One can also identify
them by the fact that they do not relate strictly to historical
or current facts. These statements reﬂect the company’s cur-
rent plans and expectations and are based on information
currently available to it. They rely on a number of assump-
tions regarding future events and estimates which could be
inaccurate and which are inherently subject to risks and
uncertainties.

The company wishes to caution the reader that the following
important factors and those important factors described
elsewhere in the commentary, or in the Securities and
Exchange Commission ﬁlings of the company, could affect
the company’s actual results and could cause such results

to vary materially from those expressed in any forward-
looking statements made by, or on behalf of, the company:

• the company’s ability to achieve the goals of its

“Transformation Plan”;

• the impact of strong competitive response to the company’s
efforts to leverage its brand power with product innovation,
promotional programs and new advertising, and of changes
in consumer demand for the company’s products;

• the risks in the marketplace associated with trade and

consumer acceptance of product improvements and new
product introductions;

• the company’s ability to achieve sales and earnings

forecasts, which are based on assumptions about sales
volume and product mix and the impact of increased
marketing investments;

• the company’s ability to realize forecasted cost savings,
including the projected outcome of global supply chain
management programs;

• the difﬁculty of predicting the pattern of inventory
movements by the company’s trade customers;

• the impact of unforeseen economic changes in currency
exchange rates, interest rates, equity markets, inﬂation
rates, recession and other external factors over which the
company has no control, including the possibility of
increased pension expense and contributions resulting
from continued decline in stock market returns; and

• the impact of unforeseen business disruptions in one or

more of the company’s markets due to political instability,
civil disobedience, armed hostilities or other calamities.

This discussion of uncertainties is by no means exhaustive
but is designed to highlight important factors that may
impact the company’s outlook. The company disclaims any
obligation or intent to update forward-looking statements
made by the company in order to reﬂect new information,
events or circumstances after the date they are made.

Consolidated Statements of Earnings
(millions, except per share amounts)

Net Sales

Costs and expenses

Cost of products sold

Marketing and selling expenses

Administrative expenses

Research and development expenses

Other expenses (Note 5)

Restructuring charges (Note 4)

Total costs and expenses
Earnings Before Interest and Taxes

Interest expense (Note 6)

Interest income

Earnings before taxes

Taxes on earnings (Note 9)
Net Earnings

Per Share – Basic

Net Earnings

Weighted average shares outstanding – basic
Per Share – Assuming Dilution

Net Earnings

Weighted average shares outstanding – assuming dilution

See accompanying Notes to Consolidated Financial Statements.

Campbell Soup Company Annual Report 2002

2002

$ 6,133

2001

$ 5,771

2000

$ 5,626

3,443

1,069

421

138

5,149

984

190

798

273

525

$ 1.28

410

$ 1.28

411

3,132

3,088

886

372

114

4,577

1,194

219

987

338

801

319

—

4,361

1,265

198

1,077

363

$ 649

$ 714

$ 1.57

414

$ 1.55

418

$ 1.68

425

$ 1.65

432

32 33

Consolidated Balance Sheets
(millions, except per share amounts)

Current Assets

Cash and cash equivalents

Accounts receivable (Note 10)

Inventories (Note 11)

Other current assets (Note 12)

Total current assets
Plant Assets, Net of Depreciation (Note 13)
Intangible Assets, Net of Amortization (Note 14)
Other Assets (Note 15)

Total assets
Current Liabilities

Notes payable (Note 16)

Payable to suppliers and others

Accrued liabilities

Dividend payable

Accrued income taxes

Total current liabilities
Long-term Debt (Note 16)
Nonpension Postretirement Beneﬁts (Note 8)
Other Liabilities (Note 17)

Total liabilities
Shareowners’ Equity (Deﬁcit) (Note 19)

Preferred stock; authorized 40 shares; none issued

Capital stock, $.0375 par value; authorized 560 shares; issued 542 shares

Capital surplus

Earnings retained in the business

Capital stock in treasury, 132 shares in 2002 and 133 shares in 2001, at cost

Accumulated other comprehensive loss

Total shareowners’ equity (deﬁcit)

Total liabilities and shareowners’ equity (deﬁcit)

See accompanying Notes to Consolidated Financial Statements.

July 28, 2002

July 29, 2001

417

638

123

1,199

1,684

2,503

335

442

597

140

1,203

1,637

2,451

636

$ 5,721

$ 5,927

$ 1,196

$ 1,806

681

503

233

2,678

2,449

319

389

5,835

—

320

4,918

(4,891)

(481)

(114)

582

450

190

3,120

2,243

336

475

6,174

—

314

4,651

(4,908)

(324)

(247)

$ 5,721

$ 5,927

Consolidated Statements of Cash Flows
(millions)

Cash Flows from Operating Activities:

Net earnings

Non-cash charges to net earnings

Restructuring charges

Depreciation and amortization

Deferred taxes

Other, net

Changes in working capital

Accounts receivable

Inventories

Other current assets and liabilities

Net Cash Provided by Operating Activities

Cash Flows from Investing Activities:

Purchases of plant assets

Sales of plant assets

Businesses acquired

Sales of businesses

Other, net

Net Cash Used in Investing Activities

Cash Flows from Financing Activities:

Long-term borrowings

Repayments of long-term borrowings

Short-term borrowings

Repayments of short-term borrowings

Dividends paid

Treasury stock purchases

Treasury stock issuances

Other, net

Net Cash Provided by (Used in) Financing Activities

Effect of Exchange Rate Changes on Cash

Net Change in Cash and Cash Equivalents

Cash and Cash Equivalents – Beginning of Year

Cash and Cash Equivalents – End of Year

See accompanying Notes to Consolidated Financial Statements.

Campbell Soup Company Annual Report 2002

2002

2001

2000

525

$ 649

$ 714

—

319

(30)

105

1,017

(269)

(15)

(12)

(288)

1,100

(628)

776

(1,691)

(286)

(5)

(6)

(726)

(6)

(3)

266

(11)

(1)

151

1,106

(200)

(911)

—

(19)

(1,122)

1,028

—

1,962

(2,007)

(374)

(618)

—

(2)

(3)

—

251

1,165

(200)

—

(22)

(204)

—

(7)

1,028

(1,206)

(384)

(394)

—

(943)

34 35

Consolidated Statements of Shareowners’ Equity (Deﬁcit)
(millions, except per share amounts)

Capital Stock

Issued

In Treasury

542

Amount

$ 20

Amount

(113)

$ (4,058)

Capital
Surplus

$ 382

Earnings
Retained
in the
Business

Accumulated

Other Com-
prehensive
Income (Loss)

Total
Share-
owners’
Equity
(Deﬁcit)

$ 4,041

$ (150)

$ 235

Balance at July 30, 2000

542

(121)

(4,373)

(11)

(394)

(11)

(3)

(521)

(97)

542

(133)

(4,908)

Balance at August 1, 1999

Comprehensive income (loss)

Net earnings

Foreign currency

translation adjustments

Other comprehensive loss

Total Comprehensive income

Dividends ($.90 per share)

Treasury stock purchased

Treasury stock issued under

management incentive and
stock option plans

Comprehensive income (loss)

Net earnings

Foreign currency

translation adjustments

Other comprehensive loss

Total Comprehensive income

Dividends ($.90 per share)

Repurchase of shares
under forward stock
purchase contracts

Treasury stock purchased

Treasury stock issued under

management incentive and
stock option plans

Balance at July 29, 2001
Comprehensive income (loss)

Net earnings

Foreign currency

translation adjustments

Cash-ﬂow hedges, net of tax

Minimum pension liability,

net of tax

Other comprehensive loss

Total Comprehensive income

Dividends ($.63 per share)

Treasury stock purchased

Treasury stock issued under

management incentive and
stock option plans

714

(382)

(77)

(38)

344

4,373

(227)

649

(371)

(97)

(30)

314

4,651

(324)

525

(258)

(208)

(157)

714

(77)

637

(382)

(394)

137

649

(97)

552

(371)

(521)

(97)

(247)

525

(208)

(157)

368

(258)

(5)

—

(5)

Balance at July 28, 2002

542

$ 20

(132)

$ (4,891)

$ 320

$ 4,918

$ (481)

$ (114)

See accompanying Notes to Consolidated Financial Statements.

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

1. Summary of Signiﬁcant Accounting Policies

Consolidation The consolidated ﬁnancial statements
include the accounts of the company and its majority-owned
subsidiaries. Signiﬁcant intercompany transactions are
eliminated in consolidation. Investments of 20% or more
in afﬁliates are accounted for by the equity method.

Fiscal Year The company’s ﬁscal year ends on the Sunday
nearest July 31. There were 52 weeks in 2002, 2001 and 2000.
There will be 53 weeks in 2003.

Revenue Recognition Revenues are recognized when the
earnings process is complete. This occurs when products are
shipped in accordance with terms of agreements, title and
risk of loss transfer to customers, collection is probable and
pricing is ﬁxed or determinable.

Cash and Cash Equivalents All highly liquid debt instruments
purchased with a maturity of three months or less are classiﬁed
as cash equivalents.

Inventories Substantially all U.S. inventories are priced at
the lower of cost or market, with cost determined by the last
in, ﬁrst out (LIFO) method. Other inventories are priced at
the lower of average cost or market.

Plant Assets Plant assets are stated at historical cost.
Alterations and major overhauls, which extend the lives or
increase the capacity of plant assets, are capitalized. The
amounts for property disposals are removed from plant asset
and accumulated depreciation accounts and any resultant
gain or loss is included in earnings. Ordinary repairs and
maintenance are charged to operating costs.

Depreciation Depreciation provided in Costs and expenses
is calculated using the straight-line method over the estimated
useful lives of the assets. Buildings and machinery and
equipment are depreciated over periods not exceeding
45 years and 15 years, respectively.

Long-lived Assets Long-lived assets are comprised of
intangible assets and property, plant and equipment.
Intangible assets consist principally of the excess purchase
price over net assets of businesses acquired and trade-
marks. Intangibles are amortized on a straight-line basis
over periods not exceeding 40 years. Long-lived assets
are reviewed for impairment as events or changes in circum-
stances occur indicating that the carrying amount of the
asset may not be recoverable. An estimate of undiscounted
future cash ﬂows produced by the asset, or the appropriate
grouping of assets, is compared to the carrying value to
determine whether an impairment exists. See Recently Issued

Accounting Pronouncements for the accounting for intangi-
ble assets in 2003.

Derivative Financial Instruments The company uses deriva-
tive ﬁnancial instruments primarily for purposes of hedging
exposures to ﬂuctuations in interest rates, foreign currency
exchange rates and equity-linked employee beneﬁt obliga-
tions. Beginning in 2001, all derivatives are accounted for
in accordance with Statement of Financial Accounting
Standards (SFAS) No. 133 “Accounting for Derivatives and
Hedging Activities,” as amended by SFAS No. 137 and
No. 138. All derivatives are recognized on the balance sheet
at fair value. Changes in the fair value of derivatives are
recorded in earnings or other comprehensive income, based
on whether the instrument is designated as part of a hedge
transaction and, if so, the type of hedge transaction. Gains
or losses on derivative instruments reported in other compre-
hensive income are reclassiﬁed to earnings in the period in
which earnings are affected by the underlying hedged item.
The ineffective portion of all hedges is recognized in earn-
ings in the current period. The cumulative effect of adopting
SFAS No. 133 was not material to the company’s consoli-
dated ﬁnancial statements.

Use of Estimates Generally accepted accounting principles
require management to make estimates and assumptions
that affect assets and liabilities, contingent assets and
liabilities, and revenues and expenses. Actual results could
differ from those estimates.

Income Taxes Income taxes are accounted for under the
asset and liability method. Deferred tax assets and liabilities
are recognized for the future tax consequences attributable
to differences between the ﬁnancial statement carrying
amounts of assets and liabilities and their respective tax bases
and operating loss and tax credit carryforwards. Deferred tax
assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered
or settled. The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in income in the period
that includes the enactment date. Valuation allowances are
recorded to reduce deferred tax assets when it is more likely
than not that a tax beneﬁt will not be realized.

Reclassiﬁcations Prior year ﬁnancial statements and
footnotes have been reclassiﬁed to conform to the current
year presentation.

In September 2000, the Financial Accounting Standards
Board’s Emerging Issues Task Force (EITF) reached a ﬁnal
consensus on Issue No. 00-10 “Accounting for Shipping and

36 37

Handling Fees and Costs” that such costs cannot be
reported as a reduction of revenue. The consensus was
effective in the fourth quarter 2001. Shipping and handling
costs of approximately $207 in 2001 and $199 in 2000 were
reclassiﬁed from Net sales to Cost of products sold. The
reclassiﬁcations had no impact on net earnings or earnings
per share.

In the ﬁrst quarter 2002, the company adopted EITF Issue
No. 00-14 “Accounting for Certain Sales Incentives” and
Issue No. 00-25 “Vendor Income Statement Characterization
of Consideration Paid to a Reseller of the Vendor’s Products,”
as codiﬁed by Issue No. 01-9 “Accounting for Consideration
Given by a Vendor to a Customer or Reseller of the Vendor’s
Products.” Under these Issues, the EITF concluded that
certain consumer and trade sales promotion expenses,
such as coupon redemption costs, cooperative advertising
programs, new product introduction fees, feature price
discounts and in-store display incentives, should be classiﬁed
as a reduction of sales rather than as marketing expenses.
The adoption of these new accounting standards in 2002
resulted in the following reclassiﬁcations to the annual results
for 2001 and 2000: Net sales were reduced by $893 and
$840, respectively; Cost of products sold was reduced by
$14 and $19, respectively; and Marketing and selling
expenses were reduced by $879 and $821, respectively.
These reclassiﬁcations had no impact on net earnings.

Recently Issued Accounting Pronouncements In July 2001,
the Financial Accounting Standards Board (FASB) issued
SFAS No. 141 “Business Combinations” and SFAS No. 142
“Goodwill and Other Intangible Assets.” In addition to
requiring that all business combinations be accounted for
under the purchase method, SFAS No. 141 requires intangible
assets that meet certain criteria to be recognized as assets
apart from goodwill. The provisions of SFAS No. 142 indicate
that goodwill and indeﬁnite life intangible assets should no
longer be amortized, but rather be tested for impairment
annually. Intangible assets with a ﬁnite life shall continue to
be amortized over the estimated useful life. SFAS No. 141
was effective for business combinations initiated after June 30,
2001. The company will adopt SFAS No. 142 in 2003. The
elimination of amortization is to be applied on a prospective
basis and prior periods are not to be restated. However, the
impact of amortization of goodwill and indeﬁnite life
intangible assets is to be disclosed for prior periods.

The company is currently evaluating the impact of SFAS
No. 142. With the adoption of SFAS No. 142, the company will
use the new criteria to assess whether goodwill and certain
other intangible assets are impaired. Any impairment charge

resulting from the initial impairment assessment will be
recorded as a cumulative effect of an accounting change.
The company estimates that the cumulative effect of adopting
this standard will result in a non-cash charge of approximately
$45 on a pre-tax basis in 2003. In addition, the adoption
of this standard is expected to beneﬁt net earnings by
approximately $55 in reduced amortization of goodwill and
indeﬁnite-lived intangible assets.

In August 2001, the FASB issued SFAS No. 144 “Accounting
for the Impairment or Disposal of Long-Lived Assets.”
This Statement addresses ﬁnancial accounting and reporting
for the impairment or disposal of long-lived assets. This
Statement supersedes SFAS No. 121, “Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets
to Be Disposed Of,” and the accounting and reporting
provisions of APB Opinion No. 30, “Reporting the Results of
Operations – Reporting the Effects of Disposal of a Segment
of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions,” for the disposal of a
segment of a business. The provisions of this Statement are
effective for ﬁscal years beginning after December 15, 2001.
The company is currently evaluating the impact of this
Statement, but does not expect the adoption to have a
material impact on the ﬁnancial statements.

In July 2002, the FASB issued SFAS No. 146 “Accounting for
Exit or Disposal Activities.” The provisions of this Statement
are effective for disposal activities initiated after December 31,
2002, with early application encouraged. The company is
currently evaluating the impact of this Statement.

2. Comprehensive Income

Total comprehensive income is comprised of net earnings,
net foreign currency translation adjustments, minimum pension
liability adjustments (see Note 8), and net unrealized gains
and losses on cash-ﬂow hedges. Total comprehensive income
for the twelve months ended July 28, 2002, July 29, 2001
and July 30, 2000 was $368, $552, and $637, respectively.

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

The components of Accumulated other comprehensive loss,
as reﬂected in the Statements of Shareowners’ Equity
(Deﬁcit), consisted of the following:

Foreign currency translation adjustments

Cash-ﬂow hedges, net of tax

Minimum pension liability, net of tax*

Total Accumulated other

comprehensive loss

* Includes a tax beneﬁt of $119.

2002

$ (275)

(208)

2001

$ (324)

—

$ (481)

$ (324)

The net gain on cash-ﬂow hedges was not material at
July 29, 2001.

3. Business and Geographic
Segment Information

Campbell Soup Company, together with its consolidated
subsidiaries, is a global manufacturer and marketer of high
quality, branded convenience food products. Through 2001,
the company was organized and reported the results of
operations in three business segments: Soup and Sauces,
Biscuits and Confectionery, and Away From Home.

Beginning in 2002, the company changed its organizational
structure such that operations are managed and reported
in four segments: North America Soup and Away From
Home, North America Sauces and Beverages, Biscuits and
Confectionery, and International Soup and Sauces. Segment
ﬁnancial information has been modiﬁed for all periods in
order to conform to the new structure. In addition, Net sales
reﬂect the reclassiﬁcations related to the adoption of new
accounting standards as discussed in Note 1.

The North America Soup and Away From Home segment
comprises the retail soup and Away From Home business in
the U.S. and Canada. The U.S. retail business includes the
Campbell’s brand condensed and ready-to-serve soups and
Swanson broths. The segment includes the company’s total
business in Canada, which comprises the Habitant and
Campbell’s soups, Prego pasta sauce and V8 juices. The
Away From Home operations represent the distribution of
products such as Campbell’s soups, Campbell’s specialty
entrees, beverage products, other prepared foods and
Pepperidge Farm products through various food service
channels. The North America Sauces and Beverages
segment includes Prego pasta sauces, Pace Mexican sauces,
Franco-American canned pastas and gravies, V8 vegetable
juices, V8 Splash juice beverages, Campbell’s tomato juice
and the total of all businesses in Mexico and other Latin
American countries. The Biscuits and Confectionery segment

includes Pepperidge Farm cookies, crackers, breads and
frozen products in North America, Arnott’s biscuits and
crackers in Australia and Asia Paciﬁc and Godiva chocolates
worldwide. The International Soup and Sauces segment
comprises operations outside of North America, including
Erasco and Heisse Tasse soups in Germany, Liebig and
Royco soups and Lesieur sauces in France, Campbell’s and
Batchelors soups, Oxo stock cubes and Homepride sauces
in the United Kingdom, Devos Lemmens mayonnaise and
cold sauces, and Campbell’s and Royco soups in Belgium,
and Blå Band and McDonnells soups in Sweden and Ireland,
respectively. In Asia Paciﬁc, operations include Campbell’s
soups and stock and Swanson broths across the region.

Accounting policies for measuring segment assets and
earnings before interest and taxes are substantially
consistent with those described in Note 1. The company
evaluates segment performance before interest and taxes,
excluding certain non-recurring charges. The North America
Soup and Away From Home and North America Sauces
and Beverages segments operate under an integrated supply
chain organization, sharing substantially all manufacturing,
warehouse, distribution and sales activities. Accordingly,
assets have been allocated between the two segments
based on various measures, for example, budgeted
production hours for ﬁxed assets and depreciation.

The company’s largest customer, Wal-Mart Stores, Inc. and its
afﬁliates, accounted for approximately 12% of consolidated
net sales during 2002. All of the company’s segments sold
products to Wal-Mart Stores, Inc. and its afﬁliates.

Information about operations by business segment, reﬂecting
the reclassiﬁcations described in Note 1, is as follows:

Business Segments

2002

Net Sales

North America Soup

Earnings

Before Depreciation
and
Interest
and Taxes)3 Amortization

Capital
Expen-
ditures

Segment
Assets

and Away From Home $ 2,524

$ 624

$ 71

$ 75 $ 1,263

North America Sauces

and Beverages

1,182

236

1,228

Biscuits and

Confectionery

International Soup

and Sauces

Corporate and
Eliminations1

1,507

175

101

100

1,276

920

—

(143)

1,632

322

Total

$ 6,133

$ 984

$ 319

$ 269 $ 5,721

38 39

2001

North America Soup

Earnings

Before Depreciation
and
Interest
and Taxes)3 Amortization

Net Sales)2

Capital
Expen-
ditures

Segment
Assets

and Away From Home

$ 2,532 $ 774

$ 67

$ 59 $ 1,248

Geographic Area Information

Information about operations in different geographic areas is
as follows:

North America Sauces

and Beverages

Biscuits and

Confectionery

International Soup

and Sauces

Corporate and
Eliminations1

1,161

295

1,446

197

632

—

(123)

1,243

1,249

1,519

Net sales1

United States

Europe

Australia/Asia Paciﬁc

Other countries

Adjustments and eliminations

2002

2001

2000

$ 4,339

$ 4,313

$ 4,179

843

554

502

(105)

558

517

455

(72)

526

561

426

(66)

668

Consolidated

$ 6,133

$ 5,771

$ 5,626

Total

2000

$ 5,771 $ 1,194

$ 266

$ 200 $ 5,927

Earnings

Before Depreciation
and
Interest
and Taxes Amortization

Net Sales)2

Capital
Expen-
ditures

Segment
Assets

North America Soup

and Away From Home

$ 2,434 $ 768

$ 67

$ 63 $ 1,302

North America Sauces

and Beverages

Biscuits and

Confectionery

International Soup

and Sauces

Other

Corporate and
Eliminations1

Total

1,156

309

1,391

206

622

—

(82)

—

1,281

1,366

—

593

—

654

$ 5,626 $ 1,265

$ 251

$ 200 $ 5,196

1 Represents elimination of intersegment sales, unallocated corporate expenses and
unallocated assets, including corporate ofﬁces, deferred income taxes and prepaid
pension assets.

2 In the fourth quarter of 2001, the company adopted new guidance on the classiﬁcation of
shipping and handling costs. Shipping and handling costs of $207 and $199 for 2001 and
2000, respectively, were reclassiﬁed from Net sales to Cost of products sold. In the ﬁrst
quarter of 2002, the company adopted new accounting standards related to the income
statement classiﬁcation of certain consumer and trade sales promotion expenses, such as
coupon redemption costs, cooperative advertising programs and in-store display incentives.
As a result, the reclassiﬁcations, recorded in 2002, reduced Net sales by $893 and $840
for 2001 and 2000, respectively. See Note 1 for further discussion.

3 Contributions to earnings before interest and taxes by the Biscuits and Confectionery

segment include the effect of costs of $20 in 2002, and $15 in 2001 associated with the
Australian manufacturing reconﬁguration.

Earnings before
interest and taxes

United States

Europe

Australia/Asia Paciﬁc

Other countries

Segment earnings before

interest and taxes

Unallocated corporate

expenses

Consolidated

Identiﬁable assets

United States

Europe

Australia/Asia Paciﬁc

Other countries

Corporate

Consolidated

2002

2001

2000

$ 913

$ 1,137

$ 1,135

1,127

1,317

1,347

(143)

(123)

(82)

$ 984

$ 1,194

$ 1,265

2002

$ 2,797

1,586

725

288

325

2001

2000

$ 2,737

$ 2,792

1,472

717

293

708

533

852

315

704

$ 5,721

$ 5,927

$ 5,196

1 In the fourth quarter of 2001, the company adopted new guidance on the classiﬁcation of
shipping and handling costs. Shipping and handling costs of $207 and $199 for 2001 and
2000, respectively, were reclassiﬁed from Net sales to Cost of products sold. In the ﬁrst
quarter of 2002, the company adopted new accounting standards related to the income
statement classiﬁcation of certain consumer and trade sales promotion expenses, such as
coupon redemption costs, cooperative advertising programs and in-store display
incentives. As a result, the reclassiﬁcations, recorded in 2002, reduced Net sales by $893
and $840 for 2001 and 2000, respectively. See Note 1 for further discussion.

Transfers between geographic areas are recorded at cost
plus markup or at market. Identiﬁable assets are those assets,
including goodwill, which are identiﬁed with the operations
in each geographic region. The restructuring charges in 2002
and 2001 were allocated to Australia/Asia Paciﬁc.

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

4. Restructuring Program

A restructuring charge of $10 ($7 after tax) was recorded
in the fourth quarter 2001 for severance costs associated
with the reconﬁguration of the manufacturing network of
Arnotts in Australia. In the second quarter 2002, the
company recorded an additional $1 restructuring charge
related to planned severance actions. Related costs of
approximately $19 ($13 after tax) in 2002 and $5 ($4 after
tax) in 2001 were recorded as Cost of products sold,
primarily representing accelerated depreciation on assets
to be taken out of service. This program was designed to
drive greater manufacturing efﬁciency resulting from the
closure of the Melbourne plant. Approximately 550 jobs
were eliminated due to the plant closure.

A summary of restructuring reserves at July 28, 2002 and
related activity is as follows:

Accrued
Balance at
July 29, 2001

2002
Charge

Accrued
Balance at
Spending July 28, 2002

allocated as follows: approximately $100 to ﬁxed assets
and inventory; approximately $490 to trademarks and other
identiﬁable intangible assets; and approximately $330 to
the excess of the purchase price over net assets acquired
(goodwill). Goodwill and trademarks were being amortized
on a straight-line basis over 40 years. An additional purchase
price adjustment of $15 was paid in 2002 related to inventory.

Had the acquisition occurred at the beginning of 2000,
based on unaudited data, net sales for 2001 and 2000 would
have increased approximately $300 and $400, respectively,
and net earnings would have decreased $2 in 2001 and
$7 in 2000. Basic and diluted earnings per share would have
decreased $.01 and $.02 in 2001 and 2000, respectively.
These pro forma estimates factor in certain adjustments,
including amortization of goodwill, additional depreciation
expense, increased interest expense on debt related to the
acquisition, and related income tax effects. The pro forma
results do not include any synergies expected to result from
the acquisition.

$ 10

(7)

$ 4

8. Pension and Postretirement Beneﬁts

Severance pay
and beneﬁts

5. Other Expenses

Stock price related
incentive programs

Amortization of intangible

and other assets

Minority interest

Other, net

6. Interest Expense

Interest expense

Less: Interest capitalized

7. Acquisitions

2002

2001

2000

$ 39

$ 36

$ 26

—

$ 138

$ 114

$ 89

2002

$ 191

$ 190

2001

$ 222

2000

$ 204

$ 219

$ 198

In May 2001, the company acquired the assets of the
European culinary brands business, comprised of several
soup and sauce businesses, from Unilever, PLC/Unilever N.V.
for approximately $920. The acquisition was ﬁnanced with
available cash and commercial paper borrowings. This
acquisition was accounted for as a purchase transaction,
and operations of the acquired business are included in
the ﬁnancial statements from May 4, 2001, the date the
acquisition was consummated. The purchase price was

Pension Beneﬁts Substantially all of the company’s U.S. and
certain non-U.S. employees are covered by noncontributory
deﬁned beneﬁt pension plans. In 1999, the company
implemented signiﬁcant amendments to certain U.S. plans.
Under a new formula, retirement beneﬁts are determined
based on percentages of annual pay and age. To minimize
the impact of converting to the new formula, service and
earnings credit will continue to accrue for active employees
participating in the plans under the formula prior to the
amendments through the year 2014. Employees will receive
the beneﬁt from either the new or old formula, whichever is
higher. Beneﬁts become vested upon the completion of ﬁve
years of service. Beneﬁts are paid from funds previously
provided to trustees and insurance companies or are paid
directly by the company from general funds. Plan assets
consist primarily of investments in equities, ﬁxed income
securities, and real estate.

Pension coverage for employees of certain non-U.S.
subsidiaries are provided to the extent determined
appropriate through their respective plans. Obligations
under such plans are systematically provided for by
depositing funds with trusts or under insurance contracts.
The assets and obligations of these plans are not material.

Postretirement Beneﬁts The company provides
postretirement beneﬁts including healthcare and life
insurance to substantially all retired U.S. employees and
their dependents. In 1999, changes were made to the

40 41

postretirement beneﬁts offered to certain U.S. employees.
Participants who were not receiving postretirement beneﬁts
as of May 1, 1999 will no longer be eligible to receive such
beneﬁts in the future, but the company will provide access
to healthcare coverage for non-eligible future retirees
on a group basis. Costs will be paid by the participants.
To preserve the economic beneﬁts for employees near
retirement, participants who were at least age 55 and
had at least 10 years of continuous service remain eligible
for postretirement beneﬁts.

Components of net periodic beneﬁt cost:

Pension

Service cost

Interest cost

Expected return
on plan assets

Amortization of net

transition obligation

Amortization of prior

service cost

Recognized net
actuarial loss

Curtailment

2002

109

2001

106

2000

103

(159)

(158)

(150)

—

(1)

—

(3)

Change in the fair value of pension plan assets:

Fair value at beginning of year

Acquisition adjustment

Actual return on plan assets

Employer contributions

Beneﬁts paid

Foreign currency adjustment

Fair value at end of year

2002

2001

$ 1,644

$ 1,846

—

(159)

(118)

(97)

—

(118)

(10)

$ 1,377

$ 1,644

Funded status as recognized in the Consolidated Balance
Sheet:

Funded status at

end of year

Unrecognized prior

service cost

Unrecognized loss

Pension

Postretirement

2002

2001

2002

2001

$ (292)

$ 122

$ (340)

$ (338)

644

220

(33)

(32)

Net amount recognized

$ 409

$ 396

$ (337)

$ (355)

Amounts recognized in the Consolidated Balance Sheet:

Net periodic pension income

(4)

$ (12)

(1)

Pension

Postretirement

Service cost

Interest cost

Amortization of prior

service cost

Amortization of net gain

Settlement

Net periodic postretirement

(income) expense

Change in beneﬁt obligation:

2002

2001

2000

(14)

—

(12)

(7)

—

(11)

(12)

(3)

Obligation at

beginning of year

Acquisition adjustment

Service cost

Interest cost

Plan amendments

Actuarial loss

Settlement

Beneﬁts paid

Foreign currency

adjustment

Beneﬁt obligation at

end of year

Pension

Postretirement

2002

2001

2002

2001

$ 1,522

$ 1,428

$ 338

$ 260

—

109

117

—

106

—

(123)

(122)

(8)

—

(16)

—

(29)

—

(1)

(30)

—

$ 1,669

$ 1,522

$ 340

$ 338

Prepaid beneﬁt cost

Intangible asset

Accumulated other comprehensive loss

2002

$ 51

327

2001

$ 396

—

Net amount recognized

$ 409

$ 396

The projected beneﬁt obligation, accumulated beneﬁt
obligation, and fair value of plan assets for the pension
plans with accumulated beneﬁt obligations in excess of plan
assets were $1,144, $1,048 and $864, respectively, as of
July 28, 2002.

The current portion of nonpension postretirement beneﬁts
included in Accrued liabilities was $19 at July 28, 2002 and
July 29, 2001.

Pension
Weighted-average assumptions at end of year:

Discount rate for

beneﬁt obligation

Expected return on

plan assets

Rate of compensation

increases

2002

2001

2000

6.90%

7.25%

7.75%

9.30%

10.00%

10.50%

4.50%

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

Postretirement
The discount rate used to determine the accumulated
postretirement beneﬁt obligation was 7.00% in 2002 and
7.25% in 2001. The assumed health care cost trend rate
used to measure the accumulated postretirement beneﬁt
obligation was 8%, declining to 4.50% in 2007 and
continuing at 4.50% thereafter.

A one percentage point change in assumed health care costs
would have the following effects on 2002 reported amounts:

Effect on service and interest cost

Effect on the 2002 accumulated beneﬁt obligation

Increase

Decrease

$ 2

$ 12

$ (2)

$ (12)

Obligations related to non-U.S. postretirement beneﬁt
plans are not signiﬁcant since these beneﬁts are generally
provided through government-sponsored plans.

Savings Plan The company sponsors employee savings
plans which cover substantially all U.S. employees. After one
year of continuous service, the company generally matches
50% of employee contributions up to 5% of compensation.
Amounts charged to Costs and expenses were $13 in 2002,
$11 in 2001, and $10 in 2000.

9. Taxes on Earnings

The provision for income taxes on earnings consists of the
following:

Income taxes:

Currently payable

Federal

State

Non-U.S.

Deferred

Federal

State

Non-U.S.

Earnings before income taxes:

United States

Non-U.S.

2002

2001

2000

$ 201

$ 254

$ 246

268

—

(2)

334

(1)

(8)

346

(4)

(15)

$ 273

$ 338

$ 363

$ 685

113

$ 798

$ 835

$ 880

152

197

$ 987

$ 1,077

The following is a reconciliation of the effective income tax
rate on continuing operations with the U.S. federal statutory
income tax rate:

Federal statutory income tax rate

State income taxes (net of

federal tax beneﬁt)

Non-U.S. earnings taxed at other

than federal statutory rate

Tax loss carryforwards

Other

2002

35.0%

2001

35.0%

2000

35.0%

1.6

(0.1)

(0.4)

(1.9)

1.5

(0.9)

(0.3)

(1.1)

1.5

(1.0)

(0.3)

(1.5)

Effective income tax rate

34.2%

33.7%

Deferred tax liabilities and assets are comprised of the
following:

Depreciation

Pensions

Other

Deferred tax liabilities

Beneﬁts and compensation

Tax loss carryforwards

Other

Gross deferred tax assets

Deferred tax asset valuation allowance

Net deferred tax assets

Net deferred tax liability

2002

$ 154

2001

$ 160

238

402

195

103

310

(10)

300

125

216

501

197

304

(12)

292

$ 102

$ 209

At July 28, 2002, non-U.S. subsidiaries of the company
have tax loss carryforwards of approximately $34. Of these
carryforwards, $2 expire through 2007 and $32 may be
carried forward indeﬁnitely. The current statutory tax rates
in these countries range from 28% to 40%.

U.S. income taxes have not been provided on undistributed
earnings of non-U.S. subsidiaries of approximately $578,
which are deemed to be permanently invested. If remitted,
tax credits or planning strategies should substantially offset
any resulting tax liability.

10. Accounts Receivable

Customers

Allowances for cash discounts and bad debts

Other

2002

$ 431

(36)

395

2001

$ 441

(28)

413

$ 417

$ 442

42 43

11. Inventories

15. Other Assets

Raw materials, containers and supplies

Finished products

2002

$ 231

407

$ 638

2001

$ 216

381

$ 597

Prepaid pension beneﬁt cost

Intangible pension asset

Investments

Other

Approximately 60% of inventory in 2002 and 61% in 2001 is
accounted for on the last in, ﬁrst out method of determining
cost. If the ﬁrst in, ﬁrst out inventory valuation method had
been used exclusively, inventories would not differ materially
from the amounts reported at July 28, 2002 and July 29, 2001.

12. Other Current Assets

Deferred taxes

Other

13. Plant Assets

Land

Buildings

Machinery and equipment

Projects in progress

Accumulated depreciation

2002

$ 86

$ 123

2001

$ 94

$ 140

2002

868

2,482

230

3,633

(1,949)

2001

840

2,354

133

3,377

(1,740)

$ 1,684

$ 1,637

Depreciation expense provided in Costs and expenses was
$241 in 2002, $209 in 2001, and $196 in 2000. Approximately
$159 of capital expenditures are required to complete
projects in progress at July 28, 2002.

14. Intangible Assets

Purchase price in excess of net assets of

businesses acquired (goodwill)

Trademarks

Other intangibles

Accumulated amortization

Type

Notes

2002

2001

$ 1,881

$ 1,856

993

2,890

(387)

890

2,757

(306)

$ 2,503

$ 2,451

Debentures

2002

$ 51

203

2001

$ 396

—

215

$ 335

$ 636

16. Notes Payable and Long-term Debt

Notes payable consists of the following:

Commercial paper

Current portion of
Long-term Debt

Variable-rate bank borrowings

2002

2001

$ 886

$ 1,789

301

$ 1,196

$ 1,806

Commercial paper had a weighted average interest rate
of 2.54% and 4.38% at July 28, 2002 and July 29, 2001,
respectively.

The current portion of Long-term Debt had a weighted
average interest rate of 6.16% and 5.79% at July 28, 2002
and July 29, 2001, respectively.

The company has short-term lines of credit of approximately
$1,982 at July 28, 2002. These lines of credit include two
committed lines of credit totaling $1,800 which support
commercial paper borrowings and remain unused at July 28,
2002, except for $45 of standby letters of credit issued on
behalf of the company.

Long-term Debt consists of the following:

Fiscal Year
of Maturity

2003

2004

2007

2009

2011

2021

Rate

2002

6.15% $ —

4.75%

5.63%

2.29%

5.72%

6.90%

5.50%

5.88%

6.75%

8.88%

300

—

300

—

300

700

200

2001

300

100

—

528

300

—

500

200

$ 2,449

$ 2,243

Other

2004-2010

6.40%-9.00%

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

The fair value of the company’s long-term debt including
the current portion of long-term debt in Notes payable was
$2,952 at July 28, 2002, and $2,323 at July 29, 2001.

therefore, does not anticipate nonperformance. In addition,
the contracts are distributed among several ﬁnancial institu-
tions, thus minimizing credit risk concentration.

The company has $1,000 of long-term debt available to issue
as of July 28, 2002 under a shelf registration statement ﬁled
with the Securities and Exchange Commission.

Principal amounts of long-term debt mature as follows:
2003–$301 (in current liabilities); 2004–$600; 2005–$1;
2006–$1; 2007–$605 and beyond–$1,242.

17. Other Liabilities

Deferred taxes

Deferred compensation

Postemployment beneﬁts

Other

2002

$ 188

121

2001

$ 303

123

$ 389

$ 475

18. Financial Instruments

The carrying values of cash and cash equivalents, accounts
and notes receivable, accounts payable and short-term debt
approximate fair value. The fair value of long-term debt, as
indicated in Note 16, and derivative ﬁnancial instruments is
based on quoted market prices.

In 2001, the company adopted SFAS No. 133, “Accounting
for Derivative Instruments and Hedging Activities,” as
amended by SFAS No. 138. The standard requires that all
derivative instruments be recorded on the balance sheet
at fair value and establishes criteria for designation and
effectiveness of the hedging relationships.

The company utilizes certain derivative ﬁnancial instruments
to enhance its ability to manage risk, including interest
rate, foreign currency, commodity and certain equity-linked
employee compensation exposures which exist as part
of ongoing business operations. Derivative instruments are
entered into for periods consistent with related underlying
exposures and do not constitute positions independent
of those exposures. The company does not enter into
contracts for speculative purposes, nor is it a party to any
leveraged derivative instrument.

The company is exposed to credit loss in the event of non-
performance by the counterparties on derivative contracts.
The company minimizes its credit risk on these transactions
by dealing only with leading, credit-worthy ﬁnancial institu-
tions having long-term credit ratings of “A” or better and,

All derivatives are recognized on the balance sheet at fair
value. On the date the derivative contract is entered into, the
company designates the derivative as (1) a hedge of the fair
value of a recognized asset or liability or of an unrecognized
ﬁrm commitment (fair-value hedge), (2) a hedge of a fore-
casted transaction or of the variability of cash ﬂows to be
received or paid related to a recognized asset or liability
(cash-ﬂow hedge), (3) a foreign-currency fair-value or cash-
ﬂow hedge (foreign-currency hedge), or (4) a hedge of a net
investment in a foreign operation. Some derivatives may
also be considered natural hedging instruments (changes in
fair value are recognized to act as economic offsets to
changes in fair value of the underlying hedged item and do
not qualify for hedge accounting under SFAS No. 133).

Changes in the fair value of a fair-value hedge, along with
the loss or gain on the hedged asset or liability that is
attributable to the hedged risk (including losses or gains on
ﬁrm commitments), are recorded in current period earnings.
Changes in the fair value of a cash-ﬂow hedge are recorded
in other comprehensive income, until earnings are affected
by the variability of cash ﬂows. Changes in the fair value of a
foreign-currency hedge are recorded in either current-period
earnings or other comprehensive income, depending on
whether the hedge transaction is a fair-value hedge (e.g.,
a hedge of a ﬁrm commitment that is to be settled in foreign
currency) or a cash-ﬂow hedge (e.g., a hedge of a foreign-
currency-denominated forecasted transaction). If, however,
a derivative is used as a hedge of a net investment in a foreign
operation, its changes in fair value, to the extent effective as a
hedge, are recorded in the cumulative translation adjustments
account within Shareowners’ equity (deﬁcit).

The company ﬁnances a portion of its operations through
debt instruments primarily consisting of commercial paper,
notes, debentures and bank loans. The company utilizes
interest rate swap agreements to minimize worldwide
ﬁnancing costs and to achieve a targeted ratio of variable
versus ﬁxed-rate debt. In 2002, the company entered into
interest rate swaps that convert ﬁxed-rate debt (5.50% notes
due in 2007 and 5.875% notes due in 2009) to variable.
These swaps mature in 2007 and 2009, respectively, and are
accounted for as fair-value hedges. The amounts paid or
received on these hedges and adjustments to fair value are
recognized as adjustments to interest expense. In 2001,
the company entered into interest rate swaps that convert
ﬁxed-rate debt (6.75% notes due in 2011) to variable. The

44 45

swaps mature in 2011 and are accounted for as fair-value
hedges. The notional amount of fair-value interest rate swaps
was $425 and $250, respectively, at July 28, 2002 and July 29,
2001. The swaps had a fair value of $31 and $5, respectively,
at July 28, 2002 and July 29, 2001.

In 2002, the company entered into interest rate swaps with
a notional value of $300 that convert variable-rate debt
to ﬁxed. The swaps mature in 2004 and are accounted for
as cash-ﬂow hedges. Consequently, the effective portion
of unrealized gains (losses) is deferred as a component of
Accumulated other comprehensive income/(loss) and is
recognized in earnings at the time the hedged item affects
earnings. The amounts paid or received on the hedge
are recognized as adjustments to interest expense. The fair
value of the swaps was $(4) as of July 28, 2002.

In anticipation of the $300 seven-year notes issued in
September 2001, the company entered into forward-starting
interest rate swap contracts with a notional value of $138.
Upon issuance of the notes, the contracts were settled at
a loss of approximately $4. This loss was recorded in other
comprehensive income/(loss) and is being amortized to
interest expense over the life of the notes.

The company is exposed to foreign currency exchange risk
as a result of transactions in currencies other than the func-
tional currency of certain subsidiaries. The company utilizes
foreign currency forward purchase and sale contracts, options
and cross-currency swaps in order to manage the volatility
associated with foreign currency purchases and certain inter-
company transactions in the normal course of business.

Qualifying forward exchange contracts and cross-currency
swap contracts are accounted for as cash-ﬂow hedges when
the hedged item is a forecasted transaction, or when future
cash ﬂows related to a recognized asset or liability are
expected to be received or paid. The effective portion of
the changes in fair value on these instruments is recorded
in Accumulated other comprehensive income/(loss) and
is reclassiﬁed into the Statement of Earnings on the same
line item and in the same period or periods in which the
hedged transaction affects earnings. The fair value of these
instruments was $(38) at July 28, 2002.

Qualifying forward exchange contracts are accounted for
as fair-value hedges when the hedged item is a recognized
asset, liability or ﬁrm commitment. The fair-value of such
contracts was not material at July 28, 2002.

The company also enters into certain foreign currency
derivative instruments that are not designated as accounting
hedges. These instruments are primarily intended to reduce

volatility of certain intercompany ﬁnancing transactions.
Gains and losses on derivatives not designated as accounting
hedges are typically recorded in Other expenses, as an offset
to gains/(losses) on the underlying transaction.

Foreign currency forward contracts typically have maturities
of less than one year. Principal currencies include the
Australian dollar, British pound, Canadian dollar, euro,
Japanese yen and Swedish krona.

As of July 28, 2002, the accumulated derivative net gain in
other comprehensive income for cash-ﬂow hedges, including
the cross-currency swaps, variable to ﬁxed interest rate
swaps and forward starting swap contracts was $2, net of tax.
At July 29, 2001, the accumulated net gain in other compre-
hensive income was not material. Reclassiﬁcations from
Accumulated other comprehensive income/(loss) into the
Statement of Earnings during the period ended July 28,
2002 were not material. There were no discontinued cash-
ﬂow hedges during the year. At July 28, 2002, the maximum
maturity date of any cash-ﬂow hedge was approximately
nine years.

Other disclosures related to hedge ineffectiveness,
gains/(losses) excluded from the assessment of hedge
effectiveness, gains/(losses) arising from effective hedges
of net investments, gains/(losses) resulting from the
discontinuance of hedge accounting and reclassiﬁcations
from other comprehensive income to earnings have been
omitted due to the insigniﬁcance of these amounts.

The company principally uses a combination of purchase
orders and various short- and long-term supply arrangements
in connection with the purchase of raw materials, including
certain commodities and agricultural products. On occasion,
the company may also enter into commodity futures
contracts, as considered appropriate, to reduce the volatility
of price ﬂuctuations for commodities such as corn, soybean
meal and cocoa. These instruments are designated as cash-
ﬂow hedges. The fair value of the effective portion of the
contracts is recorded in Accumulated other comprehensive
income/(loss) and reclassiﬁed into Cost of products sold in
the period in which the underlying transaction is recorded
in earnings. Commodity hedging activity is not material to
the company’s ﬁnancial statements.

The company is exposed to equity price changes related to
certain employee compensation obligations. Swap contracts
are utilized to hedge exposures relating to certain employee
compensation obligations linked to the total return of the
Standard & Poor’s 500 Index and the total return of the
company’s capital stock. The company pays a variable interest

Campbell Soup Company Annual Report 2002

Notes to Consolidated Financial Statements
(dollars in millions, except per share amounts)

rate and receives the equity returns under these instruments.
The notional value of the equity swap contracts, which mature
in 2003, was $53 at July 28, 2002. These instruments are not
designated as accounting hedges. Gains and losses are
recorded in Other expenses. The net liability recorded under
these contracts at July 28, 2002 was approximately $22.

19. Shareowners’ Equity (Deﬁcit)

The company has authorized 560 million shares of Capital
stock with $.0375 par value and 40 million shares of Preferred
stock, issuable in one or more classes, with or without par as
may be authorized by the Board of Directors. No Preferred
stock has been issued.

The company sponsors a long-term incentive compensation
plan. Under the plan, restricted stock and options may be
granted to certain ofﬁcers and key employees of the company.
The plan provides for awards up to an aggregate of 50 million
shares of Capital stock. Options are granted at a price not
less than the fair value of the shares on the date of grant and
expire not later than ten years after the date of grant.
Options vest over a three-year period.

The company accounts for the stock option grants and
restricted stock awards in accordance with Accounting
Principles Board Opinion No. 25 and related Interpretations.
Accordingly, no compensation expense has been recognized
in the Statements of Earnings for the options. In 1997, the
company adopted the disclosure provisions of SFAS No. 123
“Accounting for Stock-Based Compensation.” Had the
company recorded compensation expense for the fair value
of options granted consistent with SFAS No. 123, earnings
from continuing operations would have been reduced by
approximately $15, $14, and $13 in 2002, 2001 and 2000,
respectively. Earnings per share from continuing operations,
both basic and assuming dilution, would have been reduced
by $.04 in 2002, and $.03 in both 2001 and 2000.

In 2001, the Board of Directors authorized the conversion
of certain stock options to shares of restricted stock based
on speciﬁed conversion ratios. The exchange, which was vol-
untary, replaced approximately 4.7 million options with
approximately one million restricted shares. Depending on
the original grant date of the options, the restricted shares
vest in 2002, 2003 or 2004. The company recognizes compen-
sation expense throughout the vesting period of the restricted
stock. Compensation expense related to this award was $11
in 2002 and $8 in 2001.

The weighted average fair value of options granted in 2002,
2001 and 2000 was estimated as $8.09, $7.96 and $7.94,

respectively. The fair value of each option grant at grant date
is estimated using the Black-Scholes option pricing model.
The following weighted average assumptions were used for
grants in 2002, 2001 and 2000:

Risk-free interest rate

Expected life (in years)

Expected volatility

Expected dividend yield

2002

5.0%

31%

2.2%

2001

5.1%

30%

3.1%

2000

6.3%

29%

3.0%

Restricted shares granted are as follows:

(shares in thousands)

Restricted Shares

Granted

2002

2001

2000

184

573

Information about stock options and related activity is as
follows:

(options in thousands)

2002

Weighted
Average
Exercise
Price

2001

Weighted
Average
Exercise
Price

2000

Beginning of year

17,370 $ 30.30 24,024 $ 32.16 19,880 $ 32.37

Granted

Exercised

Terminated

Converted to

restricted stock

15,176

25.53

1,361

31.95

6,105

29.84

(827) 17.52

(2,434)

16.82

(1,350)

17.81

(1,713) 31.16

(929)

40.36

(611)

45.40

—

— (4,652)

46.13

—

End of year

30,006 $ 28.21 17,370 $ 30.30 24,024 $ 32.16

Exercisable at
end of year

12,595

12,160

14,850

(options in thousands)

Stock Options Outstanding

Exercisable Options

Range of
Exercise
Prices

$16.81–$22.60

$22.61–$31.91

$31.92–$44.41

$44.42–$56.50

Weighted

Average Weighted
Average
Exercise
Price

Remaining
Contractual
Life

Weighted
Average
Exercise
Price

2.0 $ 20.14

2,951 $ 20.14

2,951

23,745

8.3 $ 27.38

7,163 $ 30.76

2,754

556

30,006

6.3 $ 38.78

1,926 $ 41.28

3.8 $ 53.97

555 $ 53.99

12,595

In 1999, the company entered into forward stock purchase
contracts to partially hedge the company’s equity exposure
from its stock option program. On December 12, 2000, the
company purchased 11 million shares of common stock
under the existing forward contracts for approximately $521.

For the periods presented in the Consolidated Statements
of Earnings, the calculations of basic earnings per share
and earnings per share assuming dilution vary in that the
weighted average shares outstanding assuming dilution
includes the incremental effect of stock options, except when

46 47

such effect would be antidilutive. In 2001 and 2000, the
weighted average shares outstanding assuming dilution also
includes the incremental effect of approximately three million
and four million shares, respectively, under forward stock
purchase contracts.

space, and certain equipment. Future minimum annual rental
payments under these operating leases are as follows:

2003

$ 54

2004

$ 45

2005

$ 34

2006

$ 30

2007

$ 26

Thereafter

$ 62

20. Commitments and Contingencies

On March 30, 1998, the company effected a spinoff
of several of its non-core businesses to Vlasic Foods
International Inc. (“VFI”). VFI and several of its afﬁliates
(collectively, “Vlasic”) commenced cases under Chapter 11
of the Bankruptcy Code on January 29, 2001 in the United
States Bankruptcy Court for the District of Delaware.
Vlasic’s Second Amended Joint Plan of Distribution under
Chapter 11 (the “Plan”) was conﬁrmed by an order of the
Bankruptcy Court dated November 16, 2001, and became
effective on or about November 29, 2001. The Plan provides
for the assignment of various causes of action allegedly
belonging to the Vlasic estates, including claims against the
company allegedly arising from the spinoff, to VFB LLC, a
limited liability company (“VFB”) whose membership
interests are to be distributed under the Plan to Vlasic’s
general unsecured creditors.

On February 19, 2002, VFB commenced a lawsuit against
the company and several of its subsidiaries in the United
States District Court for the District of Delaware alleging,
among other things, fraudulent conveyance, illegal dividends
and breaches of ﬁduciary duty by Vlasic directors alleged
to be under the company’s control. The lawsuit seeks to hold
the company liable in an amount necessary to satisfy all
unpaid claims against Vlasic (which VFB estimates in the
complaint to be $250), plus unspeciﬁed exemplary and
punitive damages. While this case is still in its early stages
and the ultimate disposition of complex litigation is inherently
difﬁcult to assess, the company believes the action is without
merit and intends to defend the case vigorously.

The company is a party to other legal proceedings and
claims, environmental matters and tax issues arising out
of the normal course of business. Although the results of
the pending claims and litigation cannot be predicted with
certainty, in management’s opinion, the ﬁnal outcome of
these other legal proceedings and claims, environmental
matters and tax issues will not have a material effect on
the consolidated results of operations, ﬁnancial position
or cash ﬂows of the company.

The company has certain operating lease commitments,
primarily related to warehouse and ofﬁce facilities, retail store

The company guarantees approximately $74 of bank loans
to Pepperidge Farm independent sales distributors, which
are secured by their distribution routes that are purchased
from the company.

21. Statements of Cash Flows

Interest paid,

net of amounts capitalized

Interest received

Income taxes paid

2002

2001

2000

$ 173

$ 222

$ 208

$ 12

$ 310

$ 199

$ 10

$ 253

22. Quarterly Data (unaudited)

2002

Net sales1

Cost of products sold1

Net earnings

Per share – basic

Net earnings

Dividends

Per share – assuming

dilution

Net earnings

Market price

High

Low

2001

Net sales1

Cost of products sold1

Net earnings

Per share – basic

Net earnings

Dividends

Per share – assuming

dilution

Net earnings

Market price

High

Low

First

Second

Third

Fourth

$ 1,729

$ 1,810

$ 1,371

$ 1,223

971

171

1,004

203

782

686

0.42

0.49

0.23

0.13

0.1575

0.42

0.49

0.23

0.13

$ 29.27

$ 31.44

$ 28.85

$ 28.40

$ 25.52

$ 27.81

$ 25.59

$ 21.00

First

Second

Third

Fourth

$ 1,581

$ 1,755

$ 1,271

$ 1,164

856

204

918

271

712

122

646

0.48

0.225

0.65

0.225

0.30

0.225

0.13

0.225

0.47

0.65

0.30

0.13

$ 28.81

$ 23.75

$ 35.44

$ 28.19

$ 33.05

$ 28.25

$ 31.00

$ 25.75

1 In the fourth quarter of 2001, the company adopted new guidance on the classiﬁcation

of shipping and handling costs. Shipping and handling costs of $207 in 2001 were reclas-
siﬁed from Net sales to Cost of products sold. In the ﬁrst quarter of 2002, the company
adopted new accounting standards related to the income statement classiﬁcation of cer-
tain consumer and trade sales promotion expenses, such as coupon redemption costs,
cooperative advertising programs and in-store display incentives. As a result, the reclassiﬁ-
cations, recorded in 2002, reduced Net sales by $893 and reduced Cost of products sold
by $14 for 2001. See Note 1 for further discussion.

Campbell Soup Company Annual Report 2002

Report of Management

The accompanying ﬁnancial statements have been prepared by the management of the company in
conformity with generally accepted accounting principles to reﬂect the ﬁnancial position of the company
and its operating results. Financial information appearing throughout this Annual Report is consistent
with that in the ﬁnancial statements. Management is responsible for the information and representations
in such ﬁnancial statements, including the estimates and judgments required for their preparation.

In order to meet its responsibility, management maintains a system of internal controls designed to assure
that assets are safeguarded and that ﬁnancial records properly reﬂect all transactions. The company also
maintains a worldwide auditing function to periodically evaluate the adequacy and effectiveness of such
internal controls, as well as the company’s administrative procedures and reporting practices. The company
believes that its long-standing emphasis on the highest standards of conduct and business ethics, set forth
in extensive written policy statements, serves to reinforce its system of internal accounting controls.

The report of PricewaterhouseCoopers LLP, the company’s independent accountants, covering their audit
of the ﬁnancial statements, is included in this Annual Report. Their independent audit of the company’s
financial statements includes a review of the system of internal accounting controls to the extent they consider
necessary to evaluate the system as required by generally accepted auditing standards.

The company’s internal auditors report directly to the Audit Committee of the Board of Directors, which
is composed entirely of Directors who are not ofﬁcers or employees of the company. The Audit Committee
meets regularly with the internal auditors, other management personnel, and the independent accountants.
The independent accountants and the internal auditors have had, and continue to have, direct access to the
Audit Committee without the presence of other management personnel, and have been directed to discuss
the results of their audit work and any matters they believe should be brought to the Committee’s attention.

Douglas R. Conant
President and Chief Executive Ofﬁcer

Robert A. Schiffner
Senior Vice President and Chief Financial Ofﬁcer

Gerald S. Lord
Vice President – Controller
September 5, 2002

48 49

Report of Independent Accountants

To the Shareowners and Directors of Campbell Soup Company

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements
of earnings, shareowners’ equity (deﬁcit) and cash ﬂows present fairly, in all material respects, the ﬁnancial
position of Campbell Soup Company and its subsidiaries at July 28, 2002, and July 29, 2001, and the
results of their operations and their cash ﬂows for each of the three years in the period ended July 28, 2002,
in conformity with accounting principles generally accepted in the United States of America. These ﬁnancial
statements are the responsibility of the company’s management; our responsibility is to express an opinion
on these ﬁnancial statements based on our audits. We conducted our audits of these statements in
accordance with auditing standards generally accepted in the United States of America, which require
that we plan and perform the audit to obtain reasonable assurance about whether the ﬁnancial statements
are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the ﬁnancial statements, assessing the accounting principles used and
signiﬁcant estimates made by management, and evaluating the overall ﬁnancial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

Philadelphia, Pennsylvania
September 5, 2002

Campbell Soup Company Annual Report 2002

Five-Year Review – Consolidated
(millions, except per share amounts)

Fiscal Year
Summary of Operations

Net sales

Earnings before interest and taxes

Earnings before taxes

Earnings from continuing operations

Loss from discontinued operations

Net earnings

20021

20012

2000

19993

19984

$ 6,133

984

798

525

—

525

$ 5,771

1,194

987

649

—

649

$ 5,626

1,265

1,077

714

—

714

$ 5,803

1,270

1,097

724

—

724

$ 6,220

1,248

1,073

689

(18)

660

Financial Position

Plant assets – net

Total assets

Total debt

Shareowners’ equity

Per Share Data

$ 1,684

$ 1,637

$ 1,644

$ 1,726

$ 1,723

5,721

3,645

(114)

5,927

4,049

(247)

5,196

3,091

137

5,522

3,317

235

5,633

2,570

874

Earnings from continuing operations – basic

$ 1.28

$ 1.57

$ 1.68

$ 1.64

$ 1.52

Earnings from continuing operations –

assuming dilution

Net earnings – basic

Net earnings – assuming dilution

Dividends declared

Other Statistics

Cash margin5

Capital expenditures

Number of shareowners (in thousands)

Weighted average shares outstanding

Weighted average shares outstanding –

assuming dilution

1.28

0.63

21.2%

$ 269

410

411

1.55

1.57

1.55

0.90

1.65

1.68

1.65

0.90

1.63

1.64

1.63

0.885

1.50

1.46

1.44

0.823

25.4%

27.0%

26.3%

24.4%

200

$ 200

$ 297

256

414

418

425

432

441

445

454

460

1 2002 results include pre-tax costs of $20 ($14 after tax or $.03 per share basic and assuming dilution) related to an Australian manufacturing

reconﬁguration. Of this amount, pre-tax costs of approximately $19 were recorded in Cost of products sold.

2 2001 results include pre-tax costs of $15 ($11 after tax or $.03 per share basic and assuming dilution) related to an Australian manufacturing

reconﬁguration. Of this amount, pre-tax costs of approximately $5 were recorded in Cost of products sold.

3 1999 earnings from continuing operations include a net pre-tax restructuring charge of $36 ($27 after tax or $.06 per share basic and assuming
dilution). Earnings from continuing operations also include the effect of certain non-recurring costs of $22 ($15 after tax or $.03 per share basic and
assuming dilution).

4 1998 earnings from continuing operations include a pre-tax restructuring charge of $262 ($193 after tax or $.42 per share basic and assuming dilution).
Earnings from continuing operations also include a gain on divestiture of $14 ($9 after tax or $.02 per share basic and assuming dilution). Net earnings
include the cumulative effect of a change in accounting for business process reengineering costs of $11 or $.02 per share (basic and assuming dilution).

5 Cash margin equals earnings before interest and taxes plus depreciation, amortization and minority interest expense divided by net sales.

In 2002, ﬁnancial results were restated to conform to the requirements of new accounting standards. Certain consumer and trade promotional
expenses have been reclassiﬁed from Marketing and selling expenses and Cost of products sold to Net sales for 1998 to 2001.

The company spun off its Specialty Foods segment in 1998 and accounted for it as a discontinued operation.

Board of
Directors

Ofﬁcers
(as of October 2002)

Shareowner
Information

Douglas R. Conant
President and Chief
Executive Ofﬁcer

Jerry S. Buckley
Senior Vice President –
Public Affairs

M. Carl Johnson, III
Senior Vice President –
Chief Strategy Ofﬁcer

Ellen Oran Kaden
Senior Vice President –
Law and Government Affairs

R. David C. Macnair
Senior Vice President –
Global Research and Development

Larry S. McWilliams
Senior Vice President –
Sales and Chief Customer Ofﬁcer

Patrick O’Malley
Senior Vice President –
Global Operations

Robert A. Schiffner
Senior Vice President and
Chief Financial Ofﬁcer

Doreen A. Wright
Senior Vice President and
Chief Information Ofﬁcer

John Doumani
Vice President and President –
Campbell International

Anthony P. DiSilvestro
Vice President and Managing
Director – Campbell International

John J. Furey
Vice President and
Corporate Secretary

James A. Goldman
Vice President and President –
North America Sauces
and Beverages

Richard J. Landers
Vice President – Taxes

Gerald S. Lord
Vice President – Controller

William J. O’Shea
Vice President – Treasurer

Mark A. Sarvary
Vice President and President –
Pepperidge Farm

World Headquarters
Campbell Soup Company
Campbell Place
Camden, NJ 08103
(856) 342-4800
(856) 342-3878 (Fax)

Stock Exchange Listings
New York, Philadelphia,
London, Swiss
Ticker Symbol: CPB
Newspaper Listing: CamSp

Transfer Agent and Registrar
EquiServe Trust Company
P.O. Box 43069
Providence, RI 02940-3069
1-800-446-2617

Independent Accountants
PricewaterhouseCoopers LLP
Two Commerce Square
Suite 1700
2001 Market Street
Philadelphia, PA 19103-7042

Dividends
Campbell has paid dividends since
the company became public in
1954. Dividends are normally paid
quarterly, at the end of January,
April, July and October.

A dividend reinvestment plan
is available to shareowners.
For information about dividends
or the dividend investment plan,
write: Dividend Reinvestment Plan
Agent, Campbell Soup Company,
P.O. Box 43081, Providence, RI
02940-3081, or call (781) 575-2723
or 1-800-446-2617.

Annual Meeting
The Annual Meeting of
Shareowners will be held on
November 22, 2002 at 11:00 a.m.
Eastern Standard Time, at
Doneckers Ballroom, 100 North
State Street, Ephrata, PA 17522.

Publications
For copies of the Annual Report
or the SEC Form 10-K (ﬁled
annually in October) or other
ﬁnancial information, write
Investor Relations at the World
Headquarters address, or call
1-888-SIP-SOUP (1-888-747-7687)
or visit our worldwide website
at www.campbellsoup.com.

For copies of Campbell Soup
Company’s Equal Opportunity
Report or the Annual Report of
the Campbell Soup Foundation,
write to Public Affairs at the
World Headquarters address.

Information Sources
Inquiries regarding our products
may be addressed to Campbell’s
Consumer Response and
Information Center at the World
Headquarters address, or call
1-800-257-8443.

Media and public relations
inquiries should be directed to
Michelle Davidson, Director –
Corporate Communications at
the World Headquarters address,
or call (856) 968-4390.

Investors and ﬁnancial analysts
may contact Leonard F. Griehs,
Vice President – Investor Relations,
at the World Headquarters
address, or call (856) 342-6428.

Communications concerning
share transfer, lost certiﬁcates,
dividends and change of address
should be directed to EquiServe
Trust Company, 1-800-446-2617.

Shareowner Information Service
For the latest quarterly business
results, or other information
requests such as dividend dates,
shareowner programs or product
news, call 1-888-SIP-SOUP
(1-888-747-7687). Shareowner
information is also available on
the World Wide Web at:
www.campbellsoup.com.

Campbell Brands
Product trademarks of
Campbell Soup Company
and/or its subsidiaries
appearing in the narrative text
of this report are italicized.

Thanks to all the
employees pictured in this
year’s annual report.

George M. Sherman
Chairman of Campbell Soup
Company (2, 3)

Douglas R. Conant
President and Chief Executive
Ofﬁcer of Campbell Soup
Company (3, 4)

Alva A. App
Retired Senior Scientiﬁc
Advisor to the United Nations
Development Programme (3, 4, 5)

Edmund M. Carpenter
President and Chief Executive
Ofﬁcer of Barnes Group, Inc. (1, 4)

Bennett Dorrance
Private Investor and Chairman
and Managing Director of DMB
Associates (2, 3, 4)

Thomas W. Field, Jr.
President, Field & Associates
(1, 3, 5)

Kent B. Foster
Chairman and Chief Executive
Ofﬁcer of Ingram Micro, Inc. (1, 5)

Harvey Golub
Retired Chairman and
Chief Executive Ofﬁcer of
American Express Company (2, 4)

David K. P. Li
Chairman and Chief Executive of
The Bank of East Asia, Limited (4)

Philip E. Lippincott
Former Chairman of Campbell
Soup Company (2, 3, 4)

Mary Alice D. Malone
Private Investor and President
of Iron Spring Farm, Inc. (4, 5)

Charles H. Mott
President and Chief Executive
Ofﬁcer of John W. Bristol & Co.,
Inc. (4, 5)

Charles R. Perrin
Retired Chairman and
Chief Executive Ofﬁcer of
Avon Products, Inc. (1, 2)

Donald M. Stewart
President and Chief Executive
Ofﬁcer of the Chicago
Community Trust (2, 5)

George Strawbridge, Jr.
Private Investor (1, 3, 5)

Charlotte C. Weber
Private Investor and President
and Chief Executive Ofﬁcer of
Live Oak Properties (2, 5)

Committees
1 Audit
2 Compensation and Organization
3 Executive
4 Finance and Corporate Development
5 Governance

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Campbell Place, Camden, NJ 08103-1799 www.campbellsoup.com